BOARD MEETING
STATE OF CALIFORNIA
AIR RESOURCES BOARD
JOE SERNA, JR. BUILDING
CALIFORNIA ENVIRONMENTAL PROTECTION AGENCY
CENTRAL VALLEY AUDITORIUM, SECOND FLOOR
1001 I STREET
SACRAMENTO, CALIFORNIA
THURSDAY, SEPTEMBER 25, 2003
9:00 A.M.
JAMES F. PETERS, CSR, RPR
CERTIFIED SHORTHAND REPORTER
LICENSE NUMBER 10063
TIFFANY C. KRAFT, CSR, RPR
CERTIFIED SHORTHAND REPORTER
LICENSE NUMBER 12277
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APPEARANCES
BOARD MEMBERS
Dr. Alan Lloyd, Chairperson
Mr. Joseph Calhoun
Ms. Dorene D'Adamo
Supervisor Mark DeSaulnier
Professor Hugh Friedman
Dr. William Friedman
Supervisor Barbara Patrick
Mrs. Barbara Riordan
BOARD MEMBERS EXCUSED
Dr. William Burke
Mr. Matthew McKinnon
Supervisor Ron Roberts
STAFF
Ms. Catherine Witherspoon, Executive Officer
Mr. Tom Cackette, Chief Deputy Executive Officer
Mr. Michael Scheible, Deputy Executive Officer
Ms. Lynn Terry, Deputy Executive Officer
Ms. Kathleen Tschogl, Ombudsman
Ms. Kathleen Walsh, General Counsel
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APPEARANCES CONTINUED
STAFF
Mr. Gerhard Achtelik, Air Pollution Specialist, MSCD
Ms. Analisa Bevan, Manager, ZEV Implementation Section
Ms. Crystal Reul Chen, Air Resources Engineer, Retrofit
Implementation Section, MSCD
Mr. Bob Cross, Chief, MSCD
Ms. Cynthia Garcia, Population Studies Section, Research
Division
Ms. Annette Hebert, Chief, Heavy-Duty Diesel In-Use
Strategies Branch, MSCD
Mr. Jack Kitowski, Chief, On-Road Controls Branch
Mr. Bob Loscutoff, Chief, Monitoring and Laboratory
Division
Ms. Alexa Malik, Board Secretary
Mr. George Poppic, Staff Counsel
Mr. David Salardino, Mobile Source Control Division
Ms. Nancy Steele, Manager, Retrofit Implementation
Section, MSCD
Mr. Jim Watson, Monitoring and Laboratory Division
ALSO PRESENT
Mr. Tom Addison, Bay Area Air Quality Management Districts
Ms. Yvette Agredano, California Chapters of SWANA
Mr. David Achiro, Tahoe Truckee Sierra Disposal Co., Inc.
Mr. Don Anair, Union of Concerned Scientists
Mr. Jeff Arnold, Association of Rotation Molders
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APPEARANCES CONTINUED
ALSO PRESENT
Mr. Kelly Astor, CA Refuse Removal Council
Ms. Diane Bailey, NRDC
Mr. Rick Bell, Dupont
Ms. Emily Brown, Inform
Mr. Doug Button, South San Francisco Scavenger Co., Inc.
Mr. Todd Campbell, City of Burbank & Coalition for Clean
Air
Mr. Frank Caponi, L.A. County of Sanitation
Mr. Richard Caglia II, Industrial Waste and Salvage
Mr. Bill Dobert, Specialty Solid Waste, CRRC
Mr. Sean Edgar, California Refuse Removal Council
Ms. Shiela Edwards, Marine Sanitary Service
Mr. Mark Figone, East Bay Sanitary Company, Inc.
Mr. Jack Fiori, California Waste Recovery Systems
Mr. Tom Fulks, Green Car Institute
Ms. Sheryl Granzella, Richmond Sanitary Service
Mr. Bill Guerry, Outdoor Power Equipment Institute
Mr. Chuck Helget, Allied Waste Industries
Mr. David Huerta, City of Fremont
Ms. Bonnie Holmes-Gen, American Lung Association
Ms. Yvonne Hunter, League of California Cities
Mr. Robert Kittell, Electricab Energy
Dr. Joseph Kubsh, Manufacturer's Emission Control
Association
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APPEARANCES CONTINUED
ALSO PRESENT
Mr. Mark Leary, California Integrated Waste
Mr. Jed Mandel, Engine Manufacturers Association
Mr. Alan Marchant, Turlock Scavenger Company
Mr. Ruben Martinez, Diesel Air Fleet Service
Mr. John McNamara, California Refuse Removal Council
Mr. Jim Medich, City of West Sacramento
Mr. Sam Mendoza, City of San Diego
Mr. Daniel Meyers, City of Los Angeles
Mr. Harry Miller, Tracy Delta Solid Waste Management Co.
Mr. David Modisette, Public Policy Advocates
Mr. Michael Mohajer, L.A. County Solid Waste Management
Committee
Ms. Patricia Monahan, Union of Concerned Scientists
Mr. Kevin Mullins, Mill Valley Refuse Service
Mr. Graham Noyes, World Energy
Mr. Louie Pellegrini, Peninsula Sanitary Service
Ms. Kathryn Phillips, Center for Energy Efficiency &
Renewable Technologies
Ms. Mary Pitto, Regional Council of Rural Counties
Mr. Ronald Proto, CCRC Member Consulting Group
Mr. David Raney, Honda
Mr. Andy Rose
Mr. Greg Sanders, Varner Brothers, Inc.
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APPEARANCES CONTINUED
ALSO PRESENT
Mr. Harry Schrauth, City of Oakland
Mr. Dennis Shuler, Gilton Solid Waste Management
Mr. Wendel Smith, Global Fuel
Mr. Scott Smithline, Californians Against Waste
Mr. Kent Stoddard, Waste Management
Mr. Timothy Vail, General Motors
Mr. Tim Ward, CA Independent Oil Marketing Association
Mr. Paul Wuebben, South Coast AQMD
Ms. Stephanie Williams, CA Trucking Association
Mr. David Wilson, City of Los Angeles
Ms. Karen Wilson, Sacramento Metropolitan Air Quality
Management District
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INDEX
PAGE
Pledge of Allegiance 1
Roll Call 1
Item 03-7-1
Chairman Lloyd 16
Executive Officer Witherspoon 17
Staff Presentation 17
Q&A 21
Item 03-7-2
Chairperson Lloyd 22
Executive Officer Witherspoon 23
Staff Presentation 25
Ombudsman Tschogl 42
Q&A 44
Mr. Mark Leary 54
Ms. Yvonne Hunter 58
Mr. Daniel Meyers 60
Ms. Mary Pitto 61
Mr. Harry Schrauth 62
Mr. Michael Mohajer 62
Ms. Yvette Agredano 65
Mr. Sam Mendoza 68
Mr. Frank Caponi 75
Mr. Jed Mandel 77
Ms. Emily Brown 89
Mr. David Huerta 92
Mr. Graham Noyes 93
Ms. Stephanie Williams 100
Mr. Tim Ward 116
Mr. Kelly Astor 118
Mr. Bill Dobert 132
Mr. Greg Sanders 135
Mr. Jack Fiori 138
Mr. Andy Rose 141
Mr. Mark Figone 143
Mr. Dennis Shuler 147
Ms. Sheila Edwards 149
Mr. Kevin Mullins 151
Mr. Louie Pellegrini 154
Ms. Sheryl Granzella 157
Mr. Ronald Proto 158
Mr. Doug Button 159
Mr. David Archiro 161
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INDEX CONTINUED
PAGE
Item 03-7-2 continued
Mr. Henry Miller 162
Mr. Alan Marchant 165
Mr. John McNamara 166
Mr. Richard Caglia 171
Mr. Sean Edgar 172
Mr. Chuck Helget 176
Mr. Kent Stoddard 179
Mr. David Wilson 184
Mr. Paul Wuebben 187
Mr. Ruben Martinez 188
Dr. Joseph Kubsh 191
Mr. Scott Smithline 193
Ms. Karen Wilson 195
Mr. Todd Campbell 197
Ms. Bonnie Holmes-Gen 203
Mr. Todd Addison 206
Ms. Patricia Monahan 208
Ms. Diane Bailey 212
Mr. Wendel Smith 214
Q&A 215
Motion 230
Vote 234
Item 03-7-3 235
Chairperson Lloyd 235
Executive Officer Witherspoon 237
Staff Presentation 239
Q&A 266
Ombudsman Tschogl 284
Mr. David Raney 287
Mr. Bill Guerry 297
Mr. Joseph Kubsh 310
Mr. Don Anair 314
Mr. Rick Bell 316
Mr. Jeff Arnold 321
Mr. Jeff Medich 326
Mr. Dave Modisette 328
Mr. Jed Mandel 337
Discussion 354
Motion 355
Vote 359
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INDEX CONTINUED
PAGE
Item 03-7-4 360
Chairperson Lloyd 360
Executive Officer Witherspoon 361
Staff Presentation 362
Q&A 371
Mr. Timothy Vail 378
Mr. Tom Fulks 384
Mr. Robert Kittell 395
Ms. Kathryn Phillips 399
Discussion 405
Adjournment 410
Reporters' Certificates 412
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1 PROCEEDINGS
2 CHAIRPERSON LLOYD: Good morning. The September
3 25th, 2003, public meeting of the Air Resources Board will
4 now please come to order.
5 Dr. Friedman, will you please lead us in the
6 pledge of allegiance.
7 (Thereupon the Pledge of Allegiance was
8 Recited in Unison.)
9 CHAIRPERSON LLOYD: Thank you.
10 Will the Clerk of the Board please call the roll?
11 BOARD CLERK MALIK: Dr. Burke?
12 Mr. Calhoun?
13 BOARD MEMBER CALHOUN: Here.
14 BOARD CLERK MALIK: Ms. D'Adamo?
15 BOARD MEMBER D'ADAMO: Here.
16 BOARD CLERK MALIK: Supervisor DeSaulnier?
17 Professor Friedman?
18 BOARD MEMBER WILLIAM FRIEDMAN: Here.
19 BOARD CLERK MALIK: Dr. Friedman?
20 BOARD MEMBER HUGH FRIEDMAN: Here.
21 BOARD CLERK MALIK: Mr. McKinnon?
22 Supervisor Patrick?
23 SUPERVISOR PATRICK: Here.
24 BOARD CLERK MALIK: Ms. Riordan?
25 BOARD MEMBER RIORDAN: Here.
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1 BOARD CLERK MALIK: Supervisor Roberts?
2 Chairman Lloyd?
3 CHAIRPERSON LLOYD: Here.
4 Thank you very much.
5 Before we start this morning, I'd just like to
6 highlight a couple of my activities in the last week, and
7 one of those is Mike Scheible and myself had a chance to
8 go down to the port of Los Angeles last week to see
9 firsthand some of the issues being faced by the port and
10 also understand what can be done in terms of mitigating
11 air quality and emission issues there. So again, we had a
12 great hosting of the visit, and I think it was very, very
13 educational. Everybody has the opportunity to do that --
14 it was really impressive. And to see it's the third
15 largest port in the world behind Singapore and Hong Kong,
16 although that's traded sometime with the Port of Long
17 Beach.
18 A few interesting pieces, looking at the truck
19 traffic coming in there as well as now the increasing
20 train and rail traffic, so I think there's nothing like
21 going in firsthand and seeing what's going on.
22 Another week a delegation of us had gone down
23 including Ms. D'Adamo to visit three dairies down in
24 Modesto area, and again, that was very educational to see
25 what was going on and to understand the complexity.
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1 I'd just like to indicate the first slide
2 indicates the opportunity that Mike and I had to go out in
3 the early morning and to actually go up on one of these
4 rope ladders and we climbed up on the container ship. You
5 can see the containers right at the top. It's about 200
6 feet going up there. So we had to make sure when you got
7 on board, if it was rising and falling, make sure you got
8 out on the up.
9 BOARD MEMBER RIORDAN: Mr. Chairman, is that --
10 CHAIRMAN LLOYD: That's me going up. Mike -- we
11 have another picture of Mike also. Mike was there. We
12 had a great time.
13 That's the real story. We were disappointed that
14 we didn't have to travel further. But the person who did
15 the photography, his wife is a professional photographer
16 so he said he could embellish that for us. But it was
17 very -- it's like the fishtail. But on the serious side,
18 it was very educational. A lot can be done. But also you
19 look at this when you have 70,000 hour power diesel
20 engines coming in. You can understand the magnitude and
21 also understand what can and cannot be done when we talk
22 about electrification and whatnot. It's easier for new
23 engines than older engines. But also the port -- I was
24 impressed by the staff and the management there of trying
25 to do things and I think again we learned a lot.
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1 Next, in the last few days some of you might have
2 seen the Michelin Bibendum, the challenge they've had in
3 bringing vehicles all over the world to California and
4 they've invited 2- to 300 journalists. Started off in
5 Sacramento and then moved onto the raceway in Sonoma
6 yesterday. Again, I had the pleasure of participating
7 both days. And again, I think it gave great pleasure to
8 see the variety of vehicles out on the raceway. All the
9 way from high performance and the super clean. We had the
10 new Prius there. All of the engine manufacturers had
11 wonderful models, examples including some of the boutique
12 cars. And coming away from that also you can see the
13 dedication of Michelin to the whole issue of the
14 environment and air quality issues.
15 One graphic which came out of there, reminded me
16 when we look at tires and the importance of tires, no
17 matter what we're driving, we still are driving on those
18 tires. One in at least five gallons of gasoline we use --
19 for every five tanks, one tank of that is really wasted on
20 rolling resistance. If you look at trucks, that's two out
21 of every five. That's a dramatic indication of what can
22 be done. More focus is coming on that issue. You might
23 have seen the announcement by the Governor together with
24 the Governors of Washington and Oregon encouraging -- one
25 of the items encouraging state freight and others to use
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1 the most fuel-efficient tires as possible. That's
2 something I think we can all do. And you can see that
3 really translated back in terms of new useful things that
4 the public can do.
5 The other part I would also say on behalf of my
6 colleagues, I was really proud to see the number of clean
7 vehicles and the presentation on the super clean vehicles
8 the PZEV, joint work of Honda and U.C. Riverside and also
9 with clean gas from Chevron and Texaco. In fact, these
10 cars are so clean, you can see the progress being made,
11 not only are these vehicles clean at the start but also
12 maintaining that cleanliness.
13 And then you also had the Toyota Prius, and they
14 had a very nice example here so that they showed that
15 driving the Pruis 150,000 miles produces fewer emissions
16 than painting a 500 square foot room. In fact, one of the
17 vehicles qualified for the ATP ZEVS. I think the PZEVS
18 and ATP ZEVs are going to have a dramatic impact on
19 improving air quality. This goes all the way to -- for
20 example, if you want to go from Paris to Peking
21 approximately 7,000 miles, it's less emissions than a can
22 of insect repellant. Now it's just a dramatic example of
23 what can be done. We're going to try to get some more
24 copies of this. But I think the general public can relate
25 to these, but we're also getting the benefits in
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1 California.
2 We did get presented on behalf of Michelin --
3 because ARB and staff played a significant role in helping
4 Michelin with this event, so we got what they call a
5 Michelin Bibendum trophy. And as you can see here -- I'll
6 pass it to my colleagues. It's heavy. But it's really
7 nice. But again, I would like to particularly single out
8 Jim Fischer, Dr. Shannon Baxter of our staff and others,
9 but those are the ones that have worked diligently on
10 this, Jerry and his staff yesterday. So it was very, very
11 good.
12 Now after that, a tour of some of the technology
13 and exciting things to be done.
14 I have both the pleasure and the sad event. And
15 as most of us know, at this time our Chief Counsel,
16 Kathleen Walsh is going to be migrating west. And it's
17 going to be, I think, a great loss for us, but also a
18 great opportunity for Kathleen. Now firsthand, of course,
19 you will be knowledgeable about the travel issue, being
20 safe, indicating why they need I&M in the Bay Area. So we
21 really have a friend. And she is going to be, as you
22 know, joining the Bay Area Air Pollution Control District.
23 I'd like to read a resolution -- also recognize
24 her husband, Paul Benson, who's sitting in the front.
25 Paul, if you can just stand and we'll recognize you.
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1 Thank you.
2 The Resolution we prepared here, Resolution
3 0-3-28. Whereas, Kathleen C. Walsh has loyally served the
4 California Air Resources Board as General Counsel for
5 seven years, having joined the ARB as legal counsel in
6 1982 after beginning state service with the Office of
7 Administrative Law;
8 Whereas, for the past 20 years, Ms. Walsh has
9 been a master at juggling numerous complex legal matters
10 with aplomb, patience, thoroughness, and a fresh breeze of
11 humor;
12 Whereas, armed with her experience as lead
13 counsel for the Monterey County Office of Legal Aid, her
14 superior organizational skills, and her ornate sense of
15 balance and fairness at the Office of Administrative Law,
16 Kathleen single-handedly created the Office of
17 Administrative Appeals for ARB's heavy-duty vehicle
18 inspection program by working literally around the clock
19 during summer and fall of 1991, becoming the ARB's first
20 Administrative Law Judge and holding her first hearing in
21 early 1992;
22 Whereas, during her two years as Administrative
23 Law Judge for the heavy-duty vehicles inspection program,
24 through her unprecedented dedication, Ms. Walsh endured,
25 considered, and decided 1157 appeals out of the
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1 approximately 8500 citations issued, a marathon race
2 through 50 hearings a month;
3 Whereas, as Senior Staff Counsel, Kathleen
4 assisted the Executive Office and the Board on numerous
5 critical projects of vehicular emission control, such as
6 the adoption of tough new standards for heavy-duty
7 vehicles, passenger cars, and motorcycles and cutting-edge
8 provisions for zero-emission vehicle;
9 Whereas, Kathleen's stamina and ability to remain
10 calm under pressure were again demonstrated in the
11 development of the 1994 State Implementation Plan for
12 ozone, which has more than once saved important ARB
13 initiatives;
14 Whereas, with her characteristic compassion and
15 generosity, Kathleen has always found time to discuss the
16 quirky practice of law with law students and aspiring
17 young lawyers, inspiring several to pursue the profession;
18 Whereas, Kathleen has also inspired her two sons
19 to pursue professional careers, with her son Matthew
20 becoming a mechanical engineer and her son Joshua becoming
21 a lawyer;
22 Whereas, during her long and fruitful career at
23 the ARB, Ms. Walsh has excelled at all aspects of complex
24 legal practice, drafting hundreds of legal opinions,
25 pursuing and wisely avoiding litigation, drafting key ARB
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1 regulations, and negotiating difficult settlement
2 agreements on matters as diverse as the SIP, locomotives,
3 and ZEVs, creatively securing ARB's interests;
4 Whereas, Kathleen has sacrificed her scholarly
5 preference for secluded legal opinion drafting to
6 successfully manage a growing staff of attorneys,
7 enforcers, and regulations' coordinators; to provide
8 immediate and cogent legal advice to the Board and to
9 staff; and to be constantly available to assist in all
10 manner of urgent policy matters;
11 Whereas, Kathleen has elected to jump from the
12 frying pan into the fire by joining the legal staff of the
13 Bay Area Air Quality Management District as Assistant
14 Counsel.
15 Now, therefore be it resolved, that the Board
16 offers fervent gratitude for the significant contribution
17 Ms. Walsh has made to the practice of air pollution and
18 administrative law in California and for her substantial
19 contribution to improving air quality for our citizens.
20 Be it further resolved, that the Board wishes
21 Kathleen the best during her tenure at the Bay Area
22 District and urges her not to suffer too much nostalgia
23 for the warmth of Davis and Sacramento during the foggy
24 cold San Francisco summers.
25 With that, Kathleen, I would really say, I think
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1 we'll all miss you at a time, when up here, when we look
2 for advice, we look down and see your calm demeanor and
3 your always excellent opinion. I think we're really going
4 to miss that. But rest assured, as indicated in the
5 resolution, you've already been a tremendous contribution.
6 We look forward to working with you. I take you at your
7 word, your commitment, you're not going to come back and
8 testify before us. And with that, I wish you the very
9 best.
10 And I'd like -- if my colleagues would like to
11 add some words, please feel free to do so.
12 BOARD MEMBER D'ADAMO: Well, I'd like to add to
13 what the Chairman just said by just thanking you
14 personally. There have been numerous times, as you know,
15 throughout the years where I felt maybe a little bit of an
16 increased obligation as being the law member to make
17 certain on certain legal issues that I had a better
18 understanding of the issues, when, in fact, I didn't. And
19 I always knew that I could call on you, and you were
20 always prompt in your response. And most importantly, I
21 could rely on your expertise so that I could look better
22 and so this Board could make the right decisions.
23 So it's not often that we get to engage in
24 professional careers where we feel like we can make a
25 difference. Not only have you made a difference, but
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1 you've always done so with the utmost professionalism.
2 And you and your family should be proud of your
3 achievement. We wish you well and look forward to seeing
4 you after you go to work for the Bay Area and breathing
5 all that nice clean, crisp air. Good luck.
6 CHAIRPERSON LLOYD: Moving from D.D. on down the
7 line.
8 SUPERVISOR DeSAULNIER: Always hard to say
9 something nice about an attorney, present company
10 excepted, D.D.
11 CHAIRPERSON LLOYD: Jed, take notice.
12 SUPERVISOR DeSAULNIER: I just -- first of all,
13 this is good news/bad news for me, of course. When
14 Kathleen called and told me that she would be coming to
15 the Bay Area, at the time I was talking to the soon-to-be
16 former regional administrator for Region 9 congratulating
17 him for coming to the Bay Area. We're delighted to have
18 you. But on the other hand, I will miss you up here and
19 your level of professionalism. And for someone who's a
20 non-attorney but likes to practice attorney as a local
21 politician, the way you've reminded me professionally
22 there are things like the Constitution that I have to be
23 reminded of some control over what I do, I appreciate your
24 professionalism and the way you've dealt with me
25 personally and look forward to dealing with issues like
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1 transport into the valley as you represent the Bay Area.
2 BOARD MEMBER WILLIAM FRIEDMAN: Kathleen, I just
3 want you to know I learned a great deal from you, and it's
4 been a privilege to have worked with you. And I wish you
5 the very best and I thank you.
6 BOARD MEMBER HUGH FRIEDMAN: Kathleen, I came
7 prepared to make about an hour's worth of remarks, but
8 there's very little left to say after that resolution,
9 which is comprehensive and covers almost every facet of
10 your service long before I came to the Board, and your
11 contributions.
12 And I want to second what our law member said as
13 well. I'm glad that you're going to the Bay Area, which
14 is my home as well. And I'm glad that the fact that
15 DeSaulnier is on that Board back down there doesn't deter
16 you in any way. He has such an introspect for lawyers, as
17 you know. You'll do a great job down there. And I'm sure
18 he's delighted, as they all should be.
19 I just wanted to join in wishing you every good
20 wish, utmost satisfaction in this new passage. And you
21 and your husband, your family -- and you must be very
22 proud to have at least one out of two become a lawyer. So
23 they took a role model. So congratulations.
24 And at the appropriate time, I'd like to second
25 D.D.'s motion to pass the resolution, if I may.
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1 BOARD MEMBER RIORDAN: Kathleen, I want to thank
2 you for your thoughtful advice that you've given to us
3 over the years. It has been an extraordinary time. We've
4 accomplished a great deal, thanks to staff people like
5 yourself. And we're going to miss you, but we hope that
6 you can offer as much to the Bay Area as you've offered to
7 us. And we hope that you and Paul both enjoy your
8 retirement -- quote, retirement. And we welcome you back,
9 but again, not to testify, just to see you. And we
10 certainly understand the delight that you must have in
11 moving to the Bay Area. I can't think of a more beautiful
12 city to be in. And thank you for those long hours of time
13 that you spent trying to keep us on the straight and
14 narrow.
15 BOARD MEMBER CALHOUN: Kathleen, I've already had
16 a chance to talk with you, but I'm going to add a couple
17 things. You succeeded in getting Mike promoted to
18 Executive Officer, and you didn't stop there. You got him
19 promoted to Judge, so you're deserving of a nice relaxing
20 job with the Bay Area Air Quality Management District.
21 SUPERVISOR PATRICK: Kathleen, I, too, would like
22 to thank you very much. It's all been said, but we, as a
23 Board, have really appreciated your sage advise. We have
24 always felt comfortable that we were on a very sound legal
25 footing. Some of us do not have the benefit of being
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1 attorneys, as a couple of our members do, and we really
2 appreciate your advice. And we're going to miss you very
3 much. But those of us in the San Joaquin Valley are
4 particularly appreciative of having another friend at the
5 Bay Area District.
6 SUPERVISOR DeSAULNIER: First assignment is
7 downwind lawsuits.
8 SUPERVISOR PATRICK: She made me stay out of
9 those.
10 CHAIRPERSON LLOYD: We had a proposal, seconded
11 to the resolution. All in favor say aye.
12 (Ayes)
13 CHAIRPERSON LLOYD: Thank you.
14 (Applause)
15 CHAIRPERSON LLOYD: I want to afford you an
16 opportunity if you'd like to say something, but don't feel
17 obliged to do so.
18 GENERAL COUNSEL WALSH: Well, I will keep it
19 brief.
20 CHAIRPERSON LLOYD: No. Take as much as you
21 want. I didn't mean it that way.
22 GENERAL COUNSEL WALSH: I know we have a lot to
23 do today. And I cannot possibly say everything that is in
24 my head and my heart today. This has been a wonderful
25 place. I grew up as a lawyer here.
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1 CHAIRPERSON LLOYD: Is your microphone on?
2 GENERAL COUNSEL WALSH: I think so. Yeah.
3 This has been a great Board. And it has
4 succeeded a few other great boards, some of you were on
5 them. It's changed over time. But it has kept getting
6 better over my time here. I have been amazed and proud as
7 I watched those of you who sit up there, looking at the
8 audience behind us who sit here, at your thoughtfulness
9 your care, your concern. You have an incredibly hard jobs
10 to do, and you do it well. I know that a lot of that is
11 helped by the wonderful staff here at ARB. And I'm proud
12 to be a part of that staff.
13 As I move on to the next stage in my life --
14 which I'm very happy and pleased to be doing. It is a
15 long time dream. And believe it or not, the idea of going
16 back to the fog and the ocean breeze is just music to my
17 heart. I spent many, many a day as a young child along
18 the Carcinus Straights between the railroad tracks and the
19 bay. I was to stay off the railroad tracks and out of the
20 water, but we had an amazing amount of fun between those
21 two dangerous places. I'm so looking forward to the
22 change.
23 But I will never forget the folks I have met
24 here, and I wish you the very best of luck. I will still
25 be a Californian, still breathing the air. I look to you
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1 for the fine, fine work this Board does to protect the air
2 for Californians. Thank you very much.
3 CHAIRPERSON LLOYD: Thank you very much indeed.
4 Catherine, can you just for the Board just give
5 us a brief update about how we're going to go about -- not
6 replacing Kathleen, but replacing the position?
7 EXECUTIVE OFFICER WITHERSPOON: Our two most
8 senior counsels are alternating starting tomorrow as
9 acting general counsel. That's Bob Jenne and Tom
10 Jennings. And we have already done the interview process.
11 We do have superb candidates. And we hope to finish the
12 selection process, acquire a freeze exemption, and clear
13 the Governor's office review sometime by the middle of
14 October.
15 CHAIRPERSON LLOYD: Thank you very much.
16 With that, I'd like to move on to the first item,
17 Agenda Item 0-3-7-1. Again, I'd like to remind anyone in
18 the audience who wishes to testify on today's agenda item
19 to please sign up with the Clerk of the Board. Also, if
20 you have a written statement, please give 30 copies to the
21 Board.
22 The first agenda item is our monthly Board update
23 on recent finding on health effects of air pollution.
24 Staff will be presenting recent findings related to ozone
25 and asthma.
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1 So Ms. Witherspoon, if you'd like to begin staff
2 presentation.
3 EXECUTIVE OFFICER WITHERSPOON: Thank you, Dr.
4 Lloyd.
5 In April of this year, staff presented a study
6 about the responses of allergic asthmatics exposed to
7 ozone in controlled chamber experiments. Those results
8 show that asthmatic individuals challenged with an
9 allergen showed heightened effects when exposed to ozone.
10 Today staff will present results from a new study
11 that provides further biological evidence for the
12 synergistic effect of allergens and ozone.
13 Cynthia Garcia from the Population Research
14 Division will discuss the study results.
15 (Thereupon an overhead presentation was
16 presented as follows.)
17 MS. GARCIA: Thank you, Ms. Witherspoon.
18 Good morning, Chairman Lloyd, and members of the
19 Board. For today's health update, I will be discussing
20 two recent toxicological studies on allergen responses.
21 These studies will provide information on possible
22 mechanisms behind ozone's respiratory effect and help
23 explain the results in previous studies on the effects of
24 ozones on sensitive individuals with asthma.
25 --o0o--
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1 MS. GARCIA: The health effects of air pollution
2 on asthmatics have been a concern to the Board for some
3 time, due to the fact that asthma is one of the most
4 common chronic and disabling diseases among children and
5 adults.
6 Previously the children's health study found that
7 children that live in high-ozone communities have reduced
8 lung functions, and those who play several sports in those
9 high-ozone communities are more likely to develop asthma
10 than children who play no sports. In addition,
11 epidemiological studies have found increased medication
12 use and increased asthma symptoms were associated with
13 ozone exposure and asthmatics.
14 These studies provide a significant link between
15 ozone and asthma among sensitive individuals. However,
16 they do not provide us with a biological explanation for
17 why children and asthmatics may be more vulnerable to
18 ozone effects. The following studies attempted to. In
19 April of this year, we presented to the Board a control
20 chamber study. The results showed that asthmatic
21 individuals challenged with an allergen showed increased
22 asthmatic effects when exposed to ozone, demonstrating a
23 synergistic effect between ozone and allergen. The next
24 two recently-published studies that I will be introducing
25 to the Board today provide further biological evidence of
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1 the synergistic effect between allergens and ozone.
2 --o0o--
3 MS. GARCIA: This study on guinea pigs was
4 designed to examine the effects of ozone on
5 hyperresponsiveness, which is an increased tendency of the
6 bronchial airways to constrict, and one of the hallmarks
7 of asthma in humans. This study used an animal model to
8 explain the effects of ozone exposure in non-allergic and
9 allergic animals. Using this model, the study sought to
10 determine whether long-term engine-emitted exposure to
11 ozone reduces or worsens airway hyperresponsiveness in
12 animals who are sensitive to allergens and irritants.
13 The results of this experiment demonstrate that
14 animals exposed to ozone alone did not develop airway
15 hyperresponsiveness. However, animals sensitive to
16 allergens showed increased airway hyperresponsiveness when
17 exposed to ozone and then challenged to the allergen or
18 irritant. Therefore, ozone exacerbates the constriction
19 of the bronchial airways synergistically with the
20 allergen. This increased tendency of the bronchial
21 airways persisted for up to four weeks after ozone
22 exposure ceased.
23 --o0o--
24 MS. GARCIA: The second study examined the
25 responsiveness of a mechanism of bronchial muscle
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1 contraction after exposing the isolated bronchial tissue
2 to ozone. The experimental results indicate that exposure
3 to ozone potentiates the contraction response in human
4 bronchial when challenged to a specific allergen. This
5 synergistic effect of allergen and ozone depends on both
6 the concentration and duration of exposure to the
7 pollutant. This graph shows the effect of ozone on
8 bronchial responsiveness to an irritant challenge. The
9 higher the concentration and the relation of exposure, the
10 higher the contraction due to the irritant challenge. At
11 very high doses, there is a toxic effect with the downward
12 trend. These two toxicological findings combined help
13 provide the possible biological explanation for why and
14 how sensitive individuals are the most susceptible to the
15 effects of ozone.
16 --o0o--
17 MS. GARCIA: We have seen from these two
18 toxicological studies that ozone and allergen appears to
19 have a synergistic effect in the lungs. The effects
20 depend on the duration of concentration of ozone exposure.
21 These results contribute to our knowledge of how ozone
22 works to worsen the medical symptoms related to asthma.
23 These studies indicate that some asthmatics may be
24 particularly vulnerable to the harmful effects of ozone.
25 In addition, this will help provide general information to
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1 the Board during ozone standard review process.
2 Finally, further study on long-term ozone
3 exposure and its effect on vulnerable asthmatic
4 populations is underway. The Fresno Asthmatic Children
5 Environment Study, FACES, funded by ARB, is assigned to
6 help clarify the role of ozone and allergens such as
7 pollens, molds, and other toxics in its exacerbation of
8 asthma.
9 --o0o--
10 MS. GARCIA: Thank you for your attention today.
11 I will be happy to answer any questions.
12 CHAIRPERSON LLOYD: Thank you very much indeed.
13 BOARD MEMBER WILLIAM FRIEDMAN: Both of these
14 studies are in the category of descriptive biological
15 basic research, and they're helpful. They are stepping
16 stones to what we really need to find out, which is the
17 true basic cellular and molecular mechanism that instigate
18 asthma. After all these years, we still don't have a
19 clue. We have a lot of clinical research. And in fact,
20 as we all know, we're funding very important clinical
21 research in Fresno in the FACES study. But until we
22 really nail down precisely what triggers asthma, we're not
23 going to be able to get rid of the problem. And these
24 are, you know, reasonable studies, but they're just real
25 stepping stones to get where we need to go. There's a lot
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1 more work that needs to be done.
2 CHAIRPERSON LLOYD: Thank you very much. Thanks
3 very much. Thank you, staff.
4 We'll move ahead to Agenda Item 03-2-7, the
5 proposed diesel particulate control measure for solid
6 waste collection vehicles.
7 Diesel particulate matter was identified by this
8 Board as a toxic air contaminant in 1998. The health
9 impacts of diesel include lung cancer, increased hospital
10 admissions, and premature mortality. Diesel PM also
11 worsens allergies, asthma, and other respiratory and
12 cardiovascular diseases. The average statewide potential
13 cancer risk associated with diesel PM emissions is 540
14 potential cases per million. In the South Coast air basin
15 with the emissions even higher, the cancer risk from
16 diesel air is estimated to be 1,000 cases per million
17 people.
18 In 2000, this Board adopted a comprehensive risk
19 reduction plan for controlling diesel PM. At that time,
20 we set a goal of reducing diesel PM in California by
21 75 percent by 2010 and 85 percent by 2020. To meet these
22 goals, the plan identified three primary strategies: More
23 stringent standards for new diesel engines, a lower sulfur
24 limit of 15 PMM for diesel fuels, and controls on existing
25 diesel vehicles and equipment.
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1 ARB staff and Board have been actively working on
2 several plans to achieve these goals. The Board has
3 adopted new engine standards heavy-duty diesel vehicles, a
4 fleet rule for transit buses, an incentive program and
5 protocol for older, high emitting school buses, a
6 verification procedure for diesel PM retrofit
7 technologies, and a lower sulfur diesel fuel rule that we
8 just finished this past month.
9 Staff has worked on a host of diesel retrofit
10 rules for various vehicles and engine categories, with
11 many of those rules in the workshop process right now.
12 Staff is also verifying diesel retrofit technology as
13 rapidly as they can, with several devices now approved and
14 more in the pipeline for review.
15 We are encouraged by efforts by the industry to
16 address the reduction in PM on new engines and working
17 aggressively to reduce those in existing engines. And
18 today we are, in fact, looking at a measure to reduce PM
19 emissions from solid waste collection vehicles.
20 Ms. Witherspoon, will you please introduce this
21 item and begin staff's presentation.
22 EXECUTIVE OFFICER WITHERSPOON: Yes. Thank you,
23 Chairman Lloyd and members of the Board.
24 Our ultimate goal, as expressed in the diesel
25 risk reduction plan, is to clean up virtually every diesel
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1 engine in California. This is a huge undertaking, and
2 we're still in the learning process as to the best
3 approach for each engine family and each individual
4 vehicle fleet.
5 In addition, because diesel control technologies
6 are still in the process of being born, we've had to
7 adjust our regulatory strategies as we've gone along to
8 reflect the actual performance and availability of various
9 control devices and other emission control options. We
10 once thought it would be as simple as putting a diesel
11 filter on almost everything. We now see it's going to
12 require a skillful combination of retrofit controls,
13 engine upgrades, accelerated retirement, vehicle
14 replacement, and the use of cleaner diesel fuel
15 formulations for alternative fuels. That's the direction
16 that staff is now taking.
17 With the proposed solid waste collection vehicle
18 rule, staff is proposing to require best available control
19 technology phased in by model year groups over a
20 seven-year period. As designed in this rule, BACT for
21 diesel PM includes ARB-verified emission control
22 strategies, such as particulate filters, oxidation
23 catalysts, alternative diesel formulations like lubrizol
24 and other technologies that may be verified in the future.
25 The definition of BACT in this rule also includes the use
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1 of alternative fuels and replacement with newer clean
2 diesel engines which will be available beginning in 2007.
3 We chose to do solid waste collection vehicles
4 early in the diesel risk reduction process because of
5 their presence in residential communities. These vehicles
6 are in everyone's neighborhood once or twice a week
7 resulting in direct near-vehicle exposures. I should tell
8 that you the waste collection industry was not thrilled
9 about being the first on our list, but notwithstanding
10 those concerns, has generally responded in a thoughtful
11 and responsible way to this initiative. Staff has had
12 many discussions with industry representatives and has
13 reworked portions of the rule in response to their
14 suggestions and practical concerns.
15 The California Integrated Waste Management Board
16 was also a key player in development of this rule and in
17 making sure we have fully coordinated California's waste
18 management and air quality objectives. The Executive
19 Director of the Integrated Waste Management Board, Mark
20 Leary, is here to testify this morning, once we get to
21 that part of the proceeding.
22 The staff presentation this morning will be given
23 by Ms. Crystal Reul Chen of the Mobile Source Control
24 Division.
25 (Thereupon an overhead presentation was
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1 presented as follows.)
2 AIR RESOURCES ENGINEER CHEN: Thank you,
3 Ms. Witherspoon.
4 Chairman Lloyd, and members of the Board, it is
5 my pleasure to present the staff's proposal for
6 controlling diesel particulate matter from on-road
7 heavy-duty residential and solid waste collection
8 vehicles.
9 --o0o--
10 AIR RESOURCES ENGINEER CHEN: Today's
11 presentation includes a brief history on the need for this
12 regulation leading directly to a summary of the proposed
13 regulation and supported by a discussion of technical
14 feasibility and cost effectiveness. I will conclude the
15 presentation with the remaining issues and staff's
16 recommendation.
17 --o0o--
18 AIR RESOURCES ENGINEER CHEN: The Board
19 identified diesel particulate matter, or PM, as a toxic
20 air contaminant in 1998. Its health impacts include
21 increased risk of lung cancer, aggravation of chronic
22 respiratory symptoms such as asthma and eye, nose, and
23 lung air irritation. Also, PM in the air is tied to
24 increased hospitalization and mortality in those with
25 existing heart and lung diseases.
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1 --o0o--
2 AIR RESOURCES ENGINEER CHEN: In California,
3 studies have estimated that diesel PM emissions are
4 responsible for 70 percent of the total potential cancer
5 risk from all toxic air contaminants. No level of
6 exposure in diesel PM is considered to be safe.
7 --o0o--
8 AIR RESOURCES ENGINEER CHEN: In 2000, this Board
9 adopted a plan to significantly reduce diesel PM emissions
10 and the associated potential cancer risk from all sources.
11 The proposed control measure we have brought before you
12 today focuses on reducing diesel PM emissions from
13 existing engines, specifically solid waste collection
14 vehicles. This is the second rule to focus on reducing
15 in-use emission. The first one was a fleet rule for
16 transit agencies.
17 --o0o--
18 AIR RESOURCES ENGINEER CHEN: The benefits of
19 this rule, if adopted, are substantial. Staff estimates
20 that 80 premature deaths will have been prevented by 2020
21 at a cost of $900,000 per death prevented. This cost can
22 be compared to U.S. EPA's value of 4.2 to $5.9 million per
23 premature death. In addition, cancer risk from exposure
24 to diesel PM from collection vehicles is expected to
25 decrease. Over 2 million pounds of PM and 30,000 tons of
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1 oxides of nitrogen, or NOx, and hydrocarbon, or HC, will
2 not have been emitted to the air. And we estimate the
3 cost per household that receives trash collection service
4 at an average statewide to be less than $1 per year. This
5 is a cost effective method to reduce diesel PM and save
6 lives.
7 --o0o--
8 AIR RESOURCES ENGINEER CHEN: Now I will give you
9 an overview of the proposed regulation by describing the
10 regulations' four general discussions: Scope and
11 applicability, specific requirement for municipalities,
12 general requirements for solid waste collection vehicle
13 owners, and enforcement.
14 In my presentation, I will be including staff's
15 proposed 15-day changes to the original staff proposal. A
16 summary of the proposed changes have been provided to you
17 and is available outside the room.
18 --o0o--
19 AIR RESOURCES ENGINEER CHEN: As proposed, it
20 affects both municipalities and private owners of solid
21 waste vehicles. Municipalities may own and operate their
22 own fleets or contract for trash collection services with
23 private haulers. The vehicles covered by this rule are
24 those with 2006 and older model year engines and vehicles
25 weighing more than 14,000 pounds gross vehicle weight and
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1 used to collect residential and commercial solid waste.
2 --o0o--
3 AIR RESOURCES ENGINEER CHEN: In order to comply
4 with this rule, the vehicle owner must choose the best
5 available control technology for each of the vehicles in
6 its fleet following the phased-in implementation schedule.
7 The owner is required to keep records to demonstrate
8 compliance and make those records available on request to
9 ARB.
10 --o0o--
11 AIR RESOURCES ENGINEER CHEN: We have provided
12 owners with several options for complying with the best
13 available control technology requirements. The owner may:
14 Repower using either a diesel engine or power system that
15 meets the .01 grams per brake horsepower hour particulate
16 matter standard or one that meets the .1 gram per brake
17 horsepower hour with the addition of a retrofit device;
18 replace the diesel engine with an alternative fuel for
19 pilot ignition engines; or retrofit with a product that is
20 verified with the highest diesel PM emission reduction
21 available, such as a particulate filter or oxidation
22 catalyst.
23 --o0o--
24 AIR RESOURCES ENGINEER CHEN: If an owner
25 installs a retrofit system, it must be ARB verified. From
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1 the verified systems available, the owner must apply the
2 technology that reduces diesel PM by the greatest amount
3 or highest verified level that the manufacturer agrees is
4 feasible for the vehicle. Also the use of the system must
5 not void the original engine warranty if one is still in
6 effect. And finally, the system must be commercially
7 available.
8 --o0o--
9 AIR RESOURCES ENGINEER CHEN: Several retrofit
10 strategies are verified and available for collection
11 vehicles. Four Level 3 systems, which achieve an 85
12 percent reduction in diesel PM, are verified for 1994 to
13 2002 model year heavy-duty engines. Three of these are
14 passive diesel particulate filters and one reduces both
15 NOx and PM. No Level 2 strategies are verified yet.
16 Three systems are verified for 1991 to 2002 model years
17 that achieve Level 1 or at least a 25 percent diesel PM
18 reduction. These systems include a diesel oxidation
19 catalyst.
20 --o0o--
21 AIR RESOURCES ENGINEER CHEN: The implementation
22 schedule has been designed with the goals of phasing in
23 implementation by technical feasibility and cost. We have
24 tried to balance the availability of technologies such as
25 the .01 gram per brake horsepower hour PM engine which
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1 will be available in 2007 with providing time for owners
2 to spread out the cost of compliance. Note that the group
3 with model years 1988 to 2002 engines is split into two
4 groups, 1988 to 1993 model year engines and 1994 to 2002
5 model year engines, to ensure that the older vehicles are
6 implemented on the same schedule as the newer engines.
7 --o0o--
8 AIR RESOURCES ENGINEER CHEN: Let me now walk you
9 through the options currently available for each model
10 year group. For 1960 to 1987 model year engines, the
11 options currently are to repower to a newer diesel engine,
12 or replace with an alternative fuel or pilot ignition
13 engine, because no retrofit products are verified yet for
14 these engines. Should verified retrofitted devices become
15 available, our proposal is to restrict the use of Level 1
16 products, such as a diesel oxidation catalyst, only to
17 companies with fewer than 15 vehicles.
18 --o0o--
19 AIR RESOURCES ENGINEER CHEN: Some engines in
20 1988 to 1993 model year engine group have an additional
21 option. Diesel oxidation catalyst systems are verified
22 for 1991 through 1993 engine model years. And staff
23 expects they may be verified for 1988 to 1990 engines in
24 the future. In addition to retrofitting with a diesel
25 oxidation catalyst system, 1988 to 1993 model year engines
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1 may also be repowered or replaced.
2 For 1994 through 2002 model year engines even
3 more options exist, as diesel particulate filters and
4 oxidation catalysts systems are already verified for
5 engines of this group. Retrofits are expected to be
6 implemented more frequently than engine repowers and
7 replacement because of the lower cost of retrofit devices.
8 --o0o--
9 AIR RESOURCES ENGINEER CHEN: Finally, for 2003
10 to 2006 model year engines, staff believes diesel
11 particulate filters will be verified in the future,
12 although none are currently verified.
13 --o0o--
14 AIR RESOURCES ENGINEER CHEN: To provide owners
15 with additional flexibility, staff is proposing that some
16 extensions be available for owners. First for those
17 owners who bring 50 percent or more of their vehicles into
18 compliance early, an extension on the 100 percent
19 implementation date is available.
20 Second, if no verified retrofit product is
21 commercially available, an owner may apply for a
22 compliance extension after he's evaluated his fleet to
23 find all vehicles that can be implemented on schedule.
24 1987 and older model year engines would only be eligible
25 for a one-year extension.
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1 Finally, companies with fewer than four vehicles
2 are not required to phase in implementation but would
3 simply need to comply with the 100 percent implementation
4 date.
5 --o0o--
6 AIR RESOURCES ENGINEER CHEN: Now I will discuss
7 the benefits and cost effectiveness of the proposed rule.
8 --o0o--
9 AIR RESOURCES ENGINEER CHEN: First, I will
10 discuss the benefits from the standpoint of tons of
11 emissions produced. As you can see, this rule should
12 provide immediate and significant reductions in diesel PM
13 emissions. The chart shows three different implementation
14 scenarios. One based on currently-verified technologies
15 as of spring 2003, and two scenarios that hypothesize
16 possible future verification of technologies.
17 Diesel PM reductions from the collection vehicle
18 fleet in California as a result of this proposed
19 regulation will range from 49 to 67 percent in 2010 and 40
20 to 54 percent in 2020. Similarly, the rule will also
21 reduce NOx emissions primarily from expected engine
22 repowers and replacements. Staff used the same three
23 implementation scenarios as I discussed previously. NOx
24 reductions from the collection vehicle fleet in California
25 as a result of this proposed regulation should range from
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1 15 to 31 percent in 2010 and from 4 to 13 percent in 2020.
2 --o0o--
3 AIR RESOURCES ENGINEER CHEN: As a result of
4 reducing diesel PM emissions by 2020, staff estimates 80
5 premature deaths would be prevented. As you know,
6 particulate matter in the air is correlated with increased
7 hospital emissions and mortality. The cost of premature
8 death prevented would be $900,000. Comparing this
9 estimate cost to U.S. EPA's value of between 4.2 and 5.9
10 million for avoided deaths, this proposed regulation is a
11 very cost effective mechanism to prevent premature deaths.
12 --o0o--
13 AIR RESOURCES ENGINEER CHEN: Similarly, the
14 cancer risk from diesel PMs would be reduced by up to 27
15 cases per million in heavily affected areas near roadway
16 to landfills and up to four cases per million in an
17 average neighborhood.
18 --o0o--
19 AIR RESOURCES ENGINEER CHEN: Staff determined
20 this rule will cost 63 million over seven years,
21 increasing to a total of $154 million over 17 years. The
22 original cost reported in the June 6 staff report over a
23 seven-year implementation phase-in period was $73 million.
24 The new cost analysis corrected some errors in the
25 original analysis and extended the time period to reflect
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1 full implementation. The estimated cost effectiveness of
2 the proposed regulation on a cost-per-emissions reduced
3 basis is $32 per pound of diesel PM reduced and a $1.79
4 per pound of NOx plus hydrocarbon reduced.
5 --o0o--
6 AIR RESOURCES ENGINEER CHEN: Finally, because
7 the cost of trash collection is usually charged to the
8 households receiving service, staff calculated a cost of
9 compliance per household. With about 12.5 million
10 households in California, the average statewide cost of
11 compliance per household over the entire lifetime of the
12 proposed regulation would be about $12, or an average cost
13 per household of approximately 70 cents per year. In
14 other words, the average increase in the sanitation fee
15 charged to each household statewide should average less
16 than $1 per year.
17 --o0o--
18 AIR RESOURCES ENGINEER CHEN: Now I will turn to
19 the results of the staff's analysis of the technological
20 feasibility of this regulation.
21 --o0o--
22 AIR RESOURCES ENGINEER CHEN: We collected
23 exhaust temperature profiles through data logging 60
24 collection vehicle engines and determined that about 12
25 percent of California's total collection vehicles could be
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1 retrofitted with passive diesel particulate filters.
2 Although the average fleet wide is only 12 percent, as you
3 can see, particulate filters are most compatible with
4 front end and side loaders. In addition, particulate
5 filters work well on newer engines, such as the 1994
6 through 2002 model years.
7 --o0o--
8 AIR RESOURCES ENGINEER CHEN: Staff analyzed the
9 results of fleet in-use experiences both in the
10 United States and Europe. The two fleets with the most
11 experience are the city of Los Angeles and New York City.
12 Los Angeles first participated in BP ARCO's demonstration
13 of their low sulfur diesel fuel and particulate filter.
14 Since that pilot demonstration which started in 2000,
15 about 360 filters have been installed on L.A. collection
16 vehicles. No problems have been associated with them, and
17 L.A. plans to install about 600 more on remaining vehicles
18 in their sanitation fleet, including other truck types.
19 New York City has approximately 30 diesel
20 particulate filters installed on their sanitation trucks
21 and plans to install about 100 more on other collection
22 vehicles in their fleet.
23 --o0o--
24 AIR RESOURCES ENGINEER CHEN: ARB also
25 commissioned a study of diesel particulate filter usage
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1 and experiences in Sweden. Driven by a mandate to control
2 particulate matter emissions in specific urban areas,
3 there were as of January 2003, 22 retrofitted collection
4 vehicles and 24 vehicles with diesel particulate filters
5 installed as original equipment. No filter-related
6 problems have been reported by the vehicle owners, and the
7 program is considered to be a success.
8 --o0o--
9 AIR RESOURCES ENGINEER CHEN: That completes the
10 presentation of the proposed regulation and its technical
11 feasibility. Now I will describe issues raised by
12 stakeholders.
13 --o0o--
14 AIR RESOURCES ENGINEER CHEN: Waste haulers are
15 concerned about cost recovery, primarily by those
16 companies that collect trash under a contract with the
17 municipality. The industry proposed as a solution that
18 the municipality with the contract be responsible for
19 compliance. Staff initially proposed joint responsibility
20 with municipality, but has withdrawn that proposal as
21 discussed on the next slide.
22 In order to find out more about contracts, staff
23 worked with the Integrated Waste Management Board on a
24 survey. Surveys were e-mailed to our municipality
25 contracts, plus all of the recycling coordinators.
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1 Surveys were returned from 74 cities, 12 counties, and 4
2 military bases representing about one-third of the
3 population of California and the most populated major
4 cities and counties.
5 Staff asked if contracts included a provision
6 allowing for an increase in rates, including when there
7 was a change in law. Of those with contracts, 87 percent
8 of the contracts allowed for rate increases for changes in
9 the law, such as this proposed regulation, or other
10 non-specified increases in the cost of doing business.
11 The time to negotiate a rate change reported in surveys
12 ranged from two weeks to three years, with most reporting
13 less than a year for a rate renegotiation. Of the other
14 contracts, most will be renegotiated at some time during
15 the implementation of this rule, allowing for a rate
16 increase.
17 Staff is proposing two additions requested by the
18 industry, adding language that states the Board's intent
19 to encourage rate renegotiations and biannual progress
20 reports on implementation to foster dialogue.
21 --o0o--
22 AIR RESOURCES ENGINEER CHEN: As mentioned
23 earlier, staff is proposing changes based on issues raised
24 by the municipalities. Municipalities argued to staff
25 that the joint responsibility provision would be overly
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1 burdensome and costly as they lacked resources to enforce
2 compliance and have no control over vehicle purchasing and
3 maintenance decision. As a result of these discussions,
4 staff proposes removing most of the requirements currently
5 listed in Section 2021.1 with only some reporting
6 requirements remaining. In addition, staff recommends
7 that joint responsibility for compliance be eliminated.
8 --o0o--
9 AIR RESOURCES ENGINEER CHEN: Finally,
10 environmental organizations have argued that this rule
11 would be more stringent. They have proposed several
12 changes to make the rule more stringent; limiting
13 exemptions to one-year, splitting large groups with model
14 year 1988 to 2002 engines, and closing loopholes they
15 perceive to be in the rule. In addition, they have asked
16 staff to accelerate compliance of the oldest vehicles by
17 two years.
18 Staff compared the cost effectiveness of this
19 alternative with that of the proposed regulation and found
20 it to be about the same as staff's proposal. By beginning
21 implementation two years earlier for 1960 to 1987 model
22 year engines, an additional 18 percent diesel emission
23 reduction would be achieved for an associated cost
24 increase of about 14 percent. Staff feels that bringing
25 the 1960 to 1987 engine model year group into compliance
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1 earlier would impact small business more immediately
2 because more small businesses own the older vehicles.
3 --o0o--
4 AIR RESOURCES ENGINEER CHEN: Therefore, staff is
5 proposing to limit exemptions to one year for only the
6 oldest vehicles, to split the 1988 to 2002 group, and to
7 tighten up the implementation phase-in. Staff is adding
8 language to clarify the active fleet calculation to ensure
9 that 100 percent of the vehicles are implemented on time
10 and that vehicles cannot be double counted in two
11 implementation groups, and that an owner must evaluate all
12 of his fleet before he can apply for an exemption for any
13 engine. Staff is not, however, proposing to accelerate
14 implementation of the oldest vehicles.
15 --o0o--
16 AIR RESOURCES ENGINEER CHEN: The engine
17 manufacturers have submitted comments questioning ARB's
18 authority to adopt this regulation on two fronts. First,
19 they assert we are regulating new engines and should
20 therefore obtain a waiver from the U.S. EPA. Second they
21 assert that if we claim we are, in fact, regulating
22 non-new-engines, that we lack the authority to do so. Our
23 legal office will address these issues during the witness
24 testimony.
25 --o0o--
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1 AIR RESOURCES ENGINEER CHEN: Now I will conclude
2 by summarizing the benefits of the rule and staff's
3 recommendations.
4 --o0o--
5 AIR RESOURCES ENGINEER CHEN: To recap, the
6 proposed regulation would result in significant cost
7 effective benefits. An estimated 80 premature deaths will
8 be prevented by 2020 at a cost effective $900,000 per
9 death prevented. Cancer risk from exposure to diesel PM
10 from collection vehicles would be significantly reduced.
11 This proposal would result in between a 49 and 67 percent
12 reduction in diesel PM by 2010 and a 40 and 54 percent
13 reduction by 2020. And the cost to Californians is
14 estimated to be less than $1 per household. Staff
15 believes the benefits of the proposed regulation are
16 substantial.
17 --o0o--
18 AIR RESOURCES ENGINEER CHEN: Given the benefits
19 the proposed regulation can bring to Californians, staff
20 recommends the Board adopt new Sections 2020, 2021,
21 2021.1, and 2021.2 and direct staff to prepare 15-day
22 changes as outlined in our presentation for public comment
23 and adoption.
24 Given that this is a new rule affecting people
25 who have not been directly impacted by our rules before,
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1 staff plans to develop implementation guidelines and
2 conduct outreach and education for those affected by the
3 rules. Staff believes the proposed regulation can
4 successfully be implemented over the coming seven years.
5 Thank you.
6 CHAIRPERSON LLOYD: Thank you very much. Madam
7 Ombudsman, would you please describe the public
8 participation process that occurred while this item was
9 being developed and share any concerns or other comments
10 that you may have for the Board at this time?
11 OMBUDSMAN TSCHOGL: Thank you, Chairman Lloyd and
12 members of this Board.
13 To develop the control measure proposal before
14 you, staff has worked with many stakeholders over the past
15 three years. They held four public workshops at various
16 locations in El Monte, Los Angeles, Oakland, and
17 Sacramento. The workshops were held in the afternoon and
18 evening to ensure as much participation as possible. The
19 attendees representing the solid waste collection
20 companies and their associations, California Trucking
21 Association, Engine Manufacturers Association, field
22 suppliers, technology providers, and environmentalists and
23 other interested parties.
24 In 2000, staff initiated a feasibility study that
25 ran for more than two years. For the study, more than 100
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1 different companies voluntarily provided their engine and
2 their vehicle data for the inventory, and over 60
3 companies received free smoke capacity tests on their
4 vehicles. Another six companies allowed staff to collect
5 vehicle profile data for 60 vehicles, and thereby learned
6 which technology would serve the vehicles. Each of these
7 companies received updates to the development of the rule.
8 During 2002 and 2003, staff met approximately ten
9 times with the work group that included members of the
10 California Refuse Removal Council, plus representatives of
11 Waste Management and BPI. Staff had many phone and
12 e-mails contacts with various municipalities throughout
13 the state and held three separate meetings with them to
14 discuss the rules and implementation issues.
15 A joint effort was undertaken with the Integrated
16 Waste Management Board to provide information to those
17 possibly missed in the earlier contract. Staff also
18 discussed the proposed rule with environmental
19 organizations on numerous occasions. In addition, staff
20 attended several of the South Coast Air Quality Management
21 District's workshops and work group meetings on their
22 clean on-road residential and commercial refuse vehicles
23 rule.
24 Staff created a separate website in addition to
25 the diesel risk reduction website posting all documents
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1 including presentations associated with this rule. As
2 revisions to the control measure were made, subscribers to
3 various list serves received notices of workshops and
4 changes to the website. On June 6th, 2003, staff hosted
5 the public notification and the staff report on the
6 website. In summary, staff has worked with many
7 stakeholders through workshops, meetings, conference
8 calls, focused work group meetings, one-on-one
9 communication to develop this solid waste vehicle proposed
10 rule. Thank you.
11 CHAIRPERSON LLOYD: Thank you very much.
12 Questions. Any question from the Board at this
13 time?
14 Mr. Calhoun.
15 BOARD MEMBER CALHOUN: Would the staff comment
16 again on the durability and effectiveness of these
17 systems?
18 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
19 HEBERT: First of all, the systems have to go through a
20 very rigorous verification process where they have to
21 basically prove out durability to 50,000 miles and prove
22 that emissions are maintained at the same emissions level
23 as they were new. They have to do a minimum amount of
24 in-field testing, actually be on a vehicle or piece of
25 equipment to show that they function properly in the
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1 field. And then they also carry a five-year 150,000 mile
2 warranty.
3 BOARD MEMBER CALHOUN: Another question. It's my
4 understanding the municipalities are no longer responsible
5 for the control that's taken out.
6 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
7 HEBERT: Yes, sir.
8 BOARD MEMBER CALHOUN: Now, what about those
9 vehicles that the municipalities only accept?
10 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
11 HEBERT: They are considered the owner, and they must
12 comply with the program.
13 BOARD MEMBER CALHOUN: Who enforces this?
14 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
15 HEBERT: It's going to be the Air Resource Board. We will
16 do it through our periodic smoke inspection program by
17 checking records, cross-checking vehicles that are
18 documented to have devices on or retired or have been
19 replaced. And then as we get a little bit further into
20 the program by the heavy-duty roadside inspection, then
21 the vehicles will be cross-checked with what they're
22 supposed to have on them, or if they're supposed to have
23 been retired and the vehicle should not be in the fleet
24 any longer.
25 CHAIRPERSON LLOYD: Professor Friedman.
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1 BOARD MEMBER HUGH FRIEDMAN: There is a -- in the
2 proposed rule there is a compliance extension automatic
3 for an owner of "three or fewer" of these vehicles. That
4 is, they don't have to phase-in regardless of the model
5 year, as I understand it. And is that right?
6 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
7 HEBERT: It's for each group. If they have less than four
8 vehicles, they don't have to comply with the 100 percent
9 requirement for each group.
10 BOARD MEMBER HUGH FRIEDMAN: I'm not clear on
11 that.
12 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
13 HEBERT: Well, if they only have four vehicles, chances
14 are they either have, you know, in the same --
15 BOARD MEMBER HUGH FRIEDMAN: No. They have fewer
16 than four. If you have four, there's no extension, as I
17 understand it. It's fewer than four.
18 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
19 HEBERT: Fewer than four.
20 BOARD MEMBER HUGH FRIEDMAN: I don't want to
21 quibble, but you plucked a number.
22 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
23 HEBERT: Fewer than four.
24 BOARD MEMBER HUGH FRIEDMAN: And Annette, suppose
25 the mix -- does it matter what the mix of those four model
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1 years are? Some could be very old some, some could be
2 new -- of the three or two. But regardless of their model
3 year, they don't -- they don't have to meet or comply
4 until 2010; is that correct?
5 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
6 This is Nancy Steele.
7 CHAIRPERSON LLOYD: Can you put the mic on? Is
8 your mic on?
9 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
10 Yes. This for the model years 1988 to 2002, they would
11 have to comply by 2007. For 1960 to 1987 vehicles they
12 would comply by 2010. So they have one, two, or three
13 vehicles, those would be their final compliance dates.
14 BOARD MEMBER HUGH FRIEDMAN: So when you say
15 compliance extension, what do you mean?
16 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
17 Rather than having to comply --
18 BOARD MEMBER HUGH FRIEDMAN: Early.
19 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
20 It would be difficult to figure out what 10 percent of
21 three is. So we thought it would be easier -- plus since
22 these are very small businesses, we also thought it might
23 help them out.
24 BOARD MEMBER HUGH FRIEDMAN: Well, 10 percent of
25 four is .5.
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1 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
2 Well, because most of the compliance dates are 25 percent,
3 50 percent, 100 percent, actually, that first year is the
4 only one.
5 BOARD MEMBER HUGH FRIEDMAN: So one out of four?
6 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
7 Yes.
8 BOARD MEMBER HUGH FRIEDMAN: How is "owner"
9 defined? I couldn't find a definition anywhere in the --
10 but I may have just missed it.
11 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
12 We're using the same definition as used by the heavy-duty
13 vehicle group. That means the owner is the person that
14 owns the vehicle legally and also has control over the
15 vehicles.
16 BOARD MEMBER HUGH FRIEDMAN: Or directly or
17 indirectly to affiliates?
18 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
19 Yes.
20 BOARD MEMBER HUGH FRIEDMAN: It's broad. You
21 couldn't take a fleet and set up six or eight or ten
22 different entities, each of which owned three?
23 RETROFIT IMPLEMENTATION SECTION MANAGER STEELE:
24 Yes.
25 BOARD MEMBER HUGH FRIEDMAN: Not that anybody
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1 would do that. But that covers it. Okay. Thank you.
2 CHAIRPERSON LLOYD: Dr. Friedman.
3 BOARD MEMBER WILLIAM FRIEDMAN: I just want to
4 get a better handle on numbers. In the state, how many
5 such vehicles are we talking about, total?
6 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
7 HEBERT: It's about a little over 11,000. Between 11- and
8 12,000 right now.
9 BOARD MEMBER WILLIAM FRIEDMAN: And then of that,
10 how many owned are by entities with four or less vehicles?
11 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
12 HEBERT: Four or less vehicles --
13 BOARD MEMBER WILLIAM FRIEDMAN: I'm sorry. Less
14 than four vehicles.
15 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
16 HEBERT: It's probably less than 1 percent, I would guess.
17 BOARD MEMBER WILLIAM FRIEDMAN: So you're talking
18 about 1,000 or so -- of the total number of vehicles, it's
19 going to be 1,000.
20 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
21 HEBERT: Less than 1,000.
22 BOARD MEMBER RIORDAN: Less than 1,000.
23 BOARD MEMBER WILLIAM FRIEDMAN: And in the model
24 years '60 to '87, with the 12,000, how many are in that
25 category?
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1 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
2 HEBERT: Just '60 to '87, not counting how big their
3 fleets are?
4 BOARD MEMBER WILLIAM FRIEDMAN: Just for 1960 to
5 '87 engine model years, in that group, how many of those
6 vehicles exist?
7 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
8 HEBERT: It's about a third of the population, so that
9 would be --
10 BOARD MEMBER WILLIAM FRIEDMAN: About a third.
11 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
12 HEBERT: About 3,000.
13 BOARD MEMBER WILLIAM FRIEDMAN: And then '88 to
14 '93?
15 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
16 HEBERT: '88 to '93 would be about 15 percent. Let me
17 look that up. It's about 15 percent.
18 BOARD MEMBER WILLIAM FRIEDMAN: So about 15
19 percent or so --
20 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
21 HEBERT: Is 15, one-five.
22 BOARD MEMBER WILLIAM FRIEDMAN: About 50 percent
23 or more is '94 to the present?
24 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
25 HEBERT: Yes, sir. A little bit more.
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1 BOARD MEMBER WILLIAM FRIEDMAN: Thank you.
2 CHAIRPERSON LLOYD: What about the -- in the
3 summer you don't talk about the NOx benefits. But you're
4 assuming we're going capture some NOx benefits as well.
5 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
6 HEBERT: Yes, sir. About -- depending on how all the
7 verifications lay out, between 15 and 30 percent NOx
8 reduction.
9 CHAIRPERSON LLOYD: That also depends on what
10 retrofit device they're going to use.
11 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
12 HEBERT: It also depends heavily on repowers and
13 replacements. That's where the bulk of the NOx reductions
14 come from.
15 CHAIRPERSON LLOYD: So when you look at the
16 number of vehicles -- in terms of the number of
17 properties, when you talk about these 12,000 vehicles, how
18 many properties are we talking about? And then if we
19 bring that down, how many properties have three or less
20 vehicles?
21 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
22 HEBERT: There's about 700 companies -- so 14 percent of
23 the companies have three or less.
24 CHAIRPERSON LLOYD: 14 percent, one-four?
25 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
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1 HEBERT: Of the companies, but they don't have --
2 CHAIRPERSON LLOYD: But 14 percent of those
3 companies then. Okay. So that's --
4 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
5 HEBERT: Of the 70 companies.
6 CHAIRPERSON LLOYD: That's what we're talking
7 about. How are they -- are they distributed evenly
8 throughout the state?
9 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
10 HEBERT: Yes, sir.
11 CHAIRPERSON LLOYD: Yes. Professor Friedman.
12 BOARD MEMBER HUGH FRIEDMAN: One more question.
13 What are the owners of the 13 percent of the fleet, the
14 current contract-covered fleets that don't have a reopener
15 because of law change -- because of a change such as this?
16 What are they to do to recover the cost?
17 EXECUTIVE OFFICER WITHERSPOON: Professor
18 Friedman, because the rule is phased-in over a seven-year
19 period, we believe virtually all the contracts will open
20 at some point during that window. So even if there's not
21 an explicit reopener clause, there's both an opportunity
22 to request reopening before the contract lapses, and then
23 once the contract lapses, to increase the rate to recoup
24 the cost of having complied both before that lapse date
25 and subsequently.
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1 CHAIRPERSON LLOYD: Can I ask a question of the
2 witnesses? We have over 30 witnesses here signed up. Of
3 those, how many -- and I won't -- of the 700 companies, we
4 obviously have 100 here or less. So on the witness
5 list -- could you put your hands up in the audience --
6 represent companies that have three or less?
7 BOARD MEMBER D'ADAMO: They're out driving trucks
8 today.
9 Mr. Chairman, what I'm wondering is maybe the
10 definition of what is a small company is too small, and
11 more of what's out there may be some of the smaller
12 mid-size operators that operate more.
13 CHAIRPERSON LLOYD: So if I --
14 BOARD MEMBER D'ADAMO: If I could have that
15 information.
16 CHAIRPERSON LLOYD: So if I rephrase that to 15
17 or less, how many would go up? 15 or less.
18 (Thereupon, there was a show of hands.)
19 CHAIRPERSON LLOYD: One, two. Okay.
20 (Thereupon, there was a show of hands.)
21 CHAIRPERSON LLOYD: 50 or less. That's helpful.
22 EXECUTIVE OFFICER WITHERSPOON: Dr. Lloyd, a
23 comment on the witness list. I believe we don't have the
24 complete one before you, because there was another batch
25 of names including all of the environmental
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1 representatives. So I think the witness list is more than
2 40 individuals.
3 CHAIRPERSON LLOYD: More than 40?
4 EXECUTIVE OFFICER WITHERSPOON: More than 40.
5 Four-zero.
6 CHAIRPERSON LLOYD: Thank you.
7 EXECUTIVE OFFICER WITHERSPOON: It's 45.
8 CHAIRPERSON LLOYD: I definitely don't have that
9 one. Thanks.
10 EXECUTIVE OFFICER WITHERSPOON: It's coming.
11 CHAIRPERSON LLOYD: With that, I better -- unless
12 there are any more questions, we better promptly move
13 ahead to the witness list. And I would like to call up
14 the first of the three witnesses signed up, Mark Leary,
15 Integrated Waste Management Board, Yvonne Hunter, and
16 Daniel Meyers.
17 Welcome, Mark, and thanks for coming. And thank
18 Linda and the Board and you for working diligently with
19 staff and helping us throughout this issue. So really
20 shows great teamwork. Thanks for coming today.
21 MR. LEARY: Thank you, Dr. Lloyd, and thank you
22 members for this opportunity to testify before you.
23 I am Mark Leary, the Executive Director of the
24 California Integrated Waste Management Board. I'm here to
25 provide testimony on behalf of our Chair, Linda
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1 Moulton-Patterson. Unfortunately, the Chair is unable to
2 testify here today due to some recent arthroscopic surgery
3 that has precluded her from traveling to Sacramento. I'm
4 here to present her remarks.
5 It's a pleasure to be here today and have this
6 opportunity to discuss the proposed diesel particulate
7 matter control measures for the on-duty heavy-duty diesel
8 fueled solid waste collection vehicles. Our number one
9 mission at the Integrated Waste Management Board is to
10 protect public health, safety, and the environment for all
11 Californians. It's because of this mission that we share
12 your concern for California's air quality.
13 Our staff has been working diligently with the
14 Air Resources Board since the inception of this rule
15 making. As such, we want to gratefully acknowledge and
16 appreciate the ongoing efforts of the Air Board and have
17 greatly enjoyed the opportunity to work with your staff.
18 As a representative of the California Integrated
19 Waste Management Board, we support the Air Board rules in
20 this area. We look forward to continuing our work
21 together to address these air quality issues through our
22 cross-media affiliations.
23 We understand there's a definite need to reduce
24 diesel fuel particulate matter. As the former Mayor of
25 Huntington Beach and one of Governor Davis' appointees
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1 representing the public sector, the Chair is sensitive to
2 the concerns of local jurisdictions and counties. Our
3 job, therefore, moving forward is a delicate one.
4 We are all currently enduring financial
5 limitations that impede our daily actions. Yet, it's my
6 intention to show good faith in resolving these
7 situations. It is precisely because of these concerns and
8 the uncertainty of the upcoming legislation that we hope
9 to work together to address these limitations. The Waste
10 Board is fully aware of the importance of clean air and a
11 clean environment and respect the Air Board's role in
12 managing and protecting California's air quality, just as
13 we value our own role as environmental stewards when it
14 comes to waste diversion and landfill monitoring.
15 The principal component of our stewardship is
16 defined by Integrated Waste Management Act of 1999 which
17 required California's jurisdictions to reduce landfill
18 disposal by 50 percent by the year 2000. Through the
19 planning of waste diversion efforts of local
20 jurisdictions, California has reached 48 percent on a
21 statewide average. And as a result, California now has
22 adequate disposal capacity for the next 15 years.
23 In addition, the Waste Board's implementation of
24 the Act has created a new materials management economy
25 based on the conservation and creative reutilization of
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1 our resources. This strategy has eclipsed the
2 disposal-based waste management system of the past and has
3 set the stage for substantial economic growth.
4 Currently, California's newly developed diversion
5 and recycling businesses amount to a $10 billion industry
6 consisting of 5300 enterprises and employs 85,000
7 Californians. Waste diversion's almost twice the economic
8 impact on a per-ton basis as waste disposal. Given this
9 growth in employment and business development, the Board
10 is continuing to pursue higher levels of waste diversion
11 as we strive for zero waste, which will ultimately benefit
12 California's economy and protect California's resources.
13 However, these efforts have resulted in placing
14 more diesel-powered waste collection vehicles and trucks
15 on our California roadways and created an unintentional
16 increase of particulate emissions, hence our support for
17 your rule.
18 In conclusion, I'd like to reiterate we are
19 committed to joining the Air Resources Board as we set the
20 appropriate policies in motion to guide the development of
21 a sustainable California. By doing so, I'm certain that
22 we can continue to work together and ensure all
23 California's resources are protected now and for future
24 generations to come.
25 On behalf of our Chair, Linda Moulton-Patterson,
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1 thank you for this opportunity to testify.
2 CHAIRPERSON LLOYD: Thank you very much, Mark.
3 Thank you.
4 Yvonne Hunter, Daniel Meyers, Mary Pitto.
5 MS. HUNTER: Good morning, Board members. I'm
6 Yvonne Hunter with the League of California Cities, and I
7 thank you very much for this opportunity to testify.
8 As you probably have heard from us and numerous
9 local governments, we were in strenuous opposition to the
10 rule as it was originally put out. The League, California
11 State Association of Counties, the Rural -- I'm sorry --
12 Regional Council of Rural Counties -- I always get that
13 confused -- and the Solid Waste Association of North
14 America sent a letter in July outlining our concerns. The
15 concerns that -- and staff adequately reflected them --
16 dealt with what we viewed was the inappropriate
17 requirements on local government to serve as the
18 enforcement of compliance arm of the ARB, in part in areas
19 over which we had no control. And to sort of add insult
20 to injury, the rule, the way we interpret it, put us on
21 the hook for penalties if our haulers didn't comply.
22 I need to specify also that I'm speaking on
23 behalf of my colleague Karen King from CSAC. She was not
24 able to attend, but she and I have been in close
25 communication. She asked me to say all of my remarks,
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1 save one at the end, applies to CSAC as well.
2 One of the key issues that local government
3 raised and that we talked to the staff about extensively
4 is how solid waste is regulated in local governments and
5 the roles that cities and counties have and do not have.
6 And the key thing is a distinction between those haulers
7 who operate under a contract or a franchise -- usually
8 it's an exclusive contract or franchise -- where we have
9 rate-setting authority, as opposed to those haulers who
10 operate under a business license, a permit, perhaps under
11 a franchise that's not exclusive, where basically the
12 hauler operates with the permission of the local
13 government, and that is it. The hauler establishes its
14 own price structure. It negotiates with businesses.
15 I'd say 98 to 99 percent of residential solid
16 waste is either collected by the local government itself
17 or through an exclusive franchise or contract, but a lot
18 of the commercial is collected through what's called open
19 competition. And in many instances while the hauler may
20 get a business license permit, we don't distinguish it
21 between them. And we perhaps can't even differentiate
22 them with a permit from those who ask for a permit for a
23 beauty salon. So we needed to distinguish those issues in
24 the regs.
25 I need to compliment and thank the staff. Your
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1 staff -- you have great staff. And over the last month
2 we've had extensive conversations, e-mails, meetings with
3 them. They were very gracious with their time, generous
4 with their time. And the changes that they are proposing
5 clearly address all of our concerns. We think it makes it
6 a much better rule, and we would encourage you to adopt
7 those changes. And if you do, the League and CSAC will
8 remove our opposition. And the League -- I'm authorized
9 to go ahead and say that the League will enthusiastically
10 support the rule.
11 I also need to emphasize that our opposition was
12 focused on those operators that work through contract or
13 franchising, in no way reflected any opposition from
14 municipal-run operations. So the League is very happy to
15 work with you in getting any information out to local
16 governments about this rule, and we thank you very much
17 for your cooperation.
18 CHAIRPERSON LLOYD: Thank you very much, indeed.
19 Daniel Meyers.
20 I'm going to ask if people can keep their
21 comments to about three minutes, if you would. As I'm
22 looking ahead, I'm just doing the arithmetic here looking
23 ahead to the number of witnesses and multiplying. It's
24 pretty high so --
25 MR. MEYERS: I will keep it brief. Good morning,
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1 and thank you for the opportunity to present today.
2 Again, my name is Dan Meyers, representing the city of
3 Los Angeles. I just want to say the city does support the
4 Board's goal to improve air quality throughout the state.
5 And the city is committed to complying with all fleet air
6 standards. In fact, clarification, I turned in a card in
7 opposition. In fact, the city supports the rule in
8 general. We do oppose certain language of the rule,
9 specifically hearing Yvonne from the League of Cities, of
10 the role of municipalities. Cities strongly opposes
11 making the municipalities responsible for complying with
12 the Air Resource Board and strongly opposes making cities
13 liable for violations and fines.
14 CHAIRPERSON LLOYD: So with the modification
15 you're okay?
16 MR. MEYERS: Absolutely.
17 CHAIRPERSON LLOYD: Great.
18 MR. MEYERS: So with that -- I mean, that pretty
19 much summarizes it.
20 CHAIRPERSON LLOYD: That's all we need. That's
21 great.
22 MR. MEYERS: Thank you. See, that's brief.
23 CHAIRPERSON LLOYD: Thank you.
24 Mary Pitto, Harry Schrauth, Michael Mohajer.
25 MS. PITTO: Good morning. I'm Mary Pitto with
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1 the Regional Council of Rural Counties, and I appreciate
2 this opportunity. I'm here to just let you know that with
3 the changes as staff has proposed, the Regional Council of
4 Rural Counties are withdrawing our opposition and support
5 the rule. But I especially -- we would like to note that
6 we would like to maintain the original phase-in schedule
7 for older vehicles as they're likely to be -- the three or
8 less vehicles because they're likely to be in our
9 jurisdictions. We represent 30 rural counties. Thank
10 you.
11 CHAIRPERSON LLOYD: Thank you very much indeed.
12 Does staff have a problem with that?
13 EXECUTIVE OFFICER WITHERSPOON: It will come up
14 during the environmental testimony later.
15 CHAIRPERSON LLOYD: Okay.
16 MR. SCHRAUTH: Chairman Lloyd and members of the
17 Board, I'm Harry Schrauth with the Recycling Solid Waste
18 Program, Supervisor for the city of Oakland. The city of
19 Oakland appreciates the assistance of your staff in
20 working with us on our previous objections to the role of
21 municipalities. And with the proposed changes that we
22 heard today, the city of Oakland would support the staff
23 recommendation.
24 CHAIRPERSON LLOYD: Thank you very much indeed.
25 Mike Mohajer, Yvette Agredano, and Sam Mendoza.
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1 MR. MOHAJER: Good morning, Chairman Lloyd, and
2 members of the Board. I'll do my best to be within the
3 three minutes. My name, for the record, is Mike Mohajer.
4 I'm with the Los Angeles Integrated Waste Management Task
5 Force. Our Task Force was formed pursuant to California
6 Integrated Waste Management Act and its members include
7 appointees of the California Board of Supervisors, League
8 of Cities, South Coast AQMD, City of Long Beach, as well
9 as the waste industry.
10 I would like on behalf of the L.A. County
11 Department of Public Works and the Task Force to express
12 our appreciation to you and your staff in being so
13 responsive to some of our comments that was expressed in
14 the two letters that was forwarded to you in August 21st
15 and September 11th, 2003. Not having seen the specific of
16 the proposed amendment that staff discussed here --
17 however, I have been in the background involved, that's
18 why on the card I said I'm not opposing it. I'm not in
19 favor of it because I haven't seen the written language,
20 and hopefully after this period we'll get a chance.
21 But having said that, some of the rumors that I
22 have heard are that -- there are three areas that we do
23 have concern. The first one, we believe the information
24 that the ARB staff is looking for can be obtained from
25 local enforcement agencies that are approved by the Waste
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1 Board pursuant to Section 40130 of the Public Resources
2 Code and 71332 of the Title 14 of the Code of Regulations.
3 In reference to Los Angeles County, you also note
4 the implementation that waste collection in a majority of
5 the cities as Yvonne mentioned for the commercial is open
6 market and in the unincorporated areas are also open
7 market. So it made it very difficult for municipality, 88
8 cities, and the county unincorporated area to enforce
9 those. So I was real pleased to hear that compliance has
10 been eliminated. But it is still -- in reference to the
11 Section 2021.2, I would say paragraph B that still remains
12 that it be submitted -- information submitted to us by the
13 haulers are wrong, then the municipalities are going to be
14 subject to penalty.
15 And lastly, I saw this revised language that as
16 far as the scope of applicability is concerned, I saw some
17 language that now Air Board is expecting that the cities
18 and the contractors negotiate a new rule. And our
19 position is that really the contracts between the
20 municipalities and the haulers are -- that is where it
21 stops. And the Air Board doesn't need to be involved,
22 even indicating as it's indicated in this scope of
23 applicability.
24 So hopefully we can work with you. But again, I
25 want to express thanks very much for everything your staff
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1 has done, a substantial change from original draft.
2 CHAIRPERSON LLOYD: Thank you very much indeed.
3 Yvette Agredano, Sam Mendoza, Frank Caponi.
4 I notice here you've got oppose here.
5 MS. AGREDANO: Yes, that's correct.
6 CHAIRPERSON LLOYD: Although when we had the
7 representative of the League of Cities, SWANA was a piece
8 of that. Can you clarify why you're one of the members of
9 the signing of that opposing and when, in fact, we had
10 Yvonne Hunter testify she's changed her mind.
11 MS. AGREDANO: Well, it is correct. Yvette
12 Agredano representing the California Chapters of SWANA.
13 It is correct that we submitted a joint letter in
14 opposition of the rule back in July with the League of
15 Cities and CSAC and CRRC. However, although we do
16 appreciate staff working with us to address those
17 concerns, the California Chapters of SWANA still do have
18 some concerns with the proposed regulations. And you
19 should have before you a letter dated September 23rd
20 detailing our concerns, so I will just summarize them here
21 for you.
22 The first concern that we have -- it's more of an
23 alternative proposal. And that is that the information
24 that the ARB is seeking to gather on haulers, under Title
25 14 of the California Code of Regulations, that is already
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1 designated to the local enforcement agencies. Under
2 Section 17332, LEAs are required to maintain a complete
3 listing of all persons holding approvals to provide solid
4 waste collection services within its jurisdiction.
5 Currently, the LEAs maintains that list, and it includes
6 most, if not all, of the information that the ARB is
7 seeking under these proposed regulations.
8 We feel that the regulations should be amended so
9 that the ARB works solely with the LEA, instead of with
10 local governments to gather the information. Since before
11 you had proposed regulations, local governments would only
12 have to provide information on those haulers for which
13 they regulate the rates. We're wondering where the ARB
14 would receive the information on the haulers for which
15 local governments do not regulate the rates. And it is my
16 impression that the ARB would collect that information
17 from the same reports as provided by the LEA. So we are
18 just wondering why the LEA cannot provide the information
19 on all haulers. We feel that failure to amend the
20 regulations in this manner will result in the duplication
21 of efforts and ineffective application of state and local
22 resources towards gathering this information twice.
23 Our second concern is that we are currently
24 opposed to the section under 2021.1 which states
25 noncompliance by a municipality would have them subject to
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1 penalties. We feel that this proposed rule would subject
2 local governments to penalties for failure to submit the
3 proper reports or for submitting a late report, which may
4 be a result of haulers not providing the proper
5 information to these municipalities. We feel that this
6 noncompliance language should be taken out of the proposed
7 regulations. And we would be willing to work with staff
8 further on these two issues. And I will be available for
9 questions if you do have any.
10 CHAIRPERSON LLOYD: Thank you.
11 Staff, any comments?
12 EXECUTIVE OFFICER WITHERSPOON: We looked at the
13 issue of adding local enforcement agencies -- that's what
14 LEA stands for -- to the regulations, and we were
15 concerned that as a group that they were unaware of these
16 late-breaking discussions and not had an opportunity to
17 represent themselves in the discussion. It could arguably
18 create a notice issue for us and a clout over the
19 regulation. We do believe that the whole subject of
20 reporting is something that we're going to work our way
21 through in the implementation process. And as the witness
22 alluded, we, of course, will draw on every resource
23 available to us to get the data we need. You will hear
24 later testimony from industry seeking a BACT report on how
25 it's going, and we'll use every source available.
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1 With respect to the penalty provision, it's only
2 a penalty if the local governments do not provide the
3 information that's required of them. And our intent is
4 that's principally when they're the owners of the
5 vehicles -- and we would not go after them, enforce
6 against them for something that the haulers did not do.
7 It's just there for completeness. I think it should stay
8 in the regulation, and we'll be judicious about the use of
9 it. There are times when local governments don't submit
10 anything at all, and we just need to send them a citation
11 to say, "You really do have to abide by this regulation.
12 You own these vehicles."
13 CHAIRPERSON LLOYD: Thank you. Thank you very
14 much. Sam Mendoza, Frank Caponi, Jed Mandel.
15 MR. MENDOZA: Good morning. My name is Sam
16 Mendoza with the city of San Diego. We own and manage a
17 fleet of 138 refuse haulers for the city. In 1999, we
18 embarked in a special dual fuel program with the money
19 from the ARB, Carl Moyer money, and the city of San Diego
20 was an expenditure of about $4.6 million in one of the
21 best available technologies at the time.
22 Since that date, we have banked 76.5 tons of NOx
23 by reducing -- using the dual fuel program. Additionally,
24 we have reduced the PM by 50 percent. We are asking for a
25 special consideration for the 77 trucks. We agree with
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1 the PM proposal, and it is a good one. However, we have
2 only been in this program about two and a half years. Our
3 contractual obligation is for five years. And it seems
4 that it should not be outdated in a two-and-a-half year
5 cycle. All of the vehicles that we own other than that
6 are seven years, 70,000 miles, and they -- you know, they
7 stay that way.
8 The other concerns that we have, of course, we
9 paid 30,000 for each one -- each system on there. We
10 have -- in the Level 1 on the last one that we had, it
11 called for a reduction of 25 to 69 percent. We've
12 actually achieved 50 percent PM reduction, and that is
13 certified on your executive order which you should have a
14 copy of A 3260021 reduces it from .10 to .05 using the
15 dual fuel engine. We also showed that the engine does run
16 one tenth -- 1 to 10 ratio -- excuse me. A little bit
17 nervous. And we have supplied the documentation in front
18 of you to show that the delusion rate including the 1200
19 RPM diesel is 90.50.
20 The only request that we would have is that the
21 best available control technology for that engine be
22 modified slightly to allow a emergency fallback limp home
23 motor, rather than have it shut off on the highway and
24 stall in the middle of the road. What that does, of
25 course, it just allows us to get home. We can't operate
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1 any longer than the specific time. It has to be repaired
2 before it sees the road again.
3 CHAIRPERSON LLOYD: Thank you. Questions?
4 Dr. Friedman.
5 BOARD MEMBER WILLIAM FRIEDMAN: So 62 percent of
6 your vehicles are spewing out diesel PM; right? I mean --
7 MR. MENDOZA: Yes.
8 BOARD MEMBER WILLIAM FRIEDMAN: These are the
9 numbers. What would you like us to do about that?
10 MR. MENDOZA: The remaining fleet we are -- we do
11 agree with the program, and we will implement the PM
12 program as proposed. We don't have any problem.
13 The only consideration that we would like is for
14 going into this program early, you know, without any
15 mandate and cleaning up the air, which we've already
16 banked, you know, 76 tons of NOx, and we've reduced the PM
17 by 50 percent without having to do so. So all we're
18 asking for is for these 77 trucks that we still are in
19 contractual obligation is we would have some type of
20 consideration for the remaining three years, you know, or
21 four years that we have to pay these trucks off.
22 BOARD MEMBER RIORDAN: Excuse me, Mr. Chairman.
23 Has staff thought about this unique case?
24 EXECUTIVE OFFICER WITHERSPOON: It's a dilemma.
25 The vehicles that the witness is talking about are new
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1 purchases, and new vehicles would have entered the fleet,
2 in any event, less clean than what was purchased, you
3 know, less NOx reduction. And so there were public moneys
4 applied. And the city of San Diego moved in this
5 direction with dual fuel and principally for the NOx
6 reductions.
7 The rule before you is a particulate control
8 rule, and we've tried to think through different ways of
9 giving them some flexibility, whether you excluded the
10 77 vehicles from your calculation as you went through the
11 percent that needed to be regulated or moved them to
12 different groups. But we're not completely convinced
13 that's overly burdensome since we're talking about
14 particulate effects, and the particulate is still there.
15 But if you want us to keep searching for the right
16 approach for this unique situation, we will continue
17 endeavoring to do so and try to come up with something in
18 the 15-day change period.
19 MR. MENDOZA: The reminder of the fleet will be
20 in compliance and also will all the future purchases. We
21 have no problem with the proposed regulation. It is a
22 good one. We agree with it. However, this one being not
23 even halfway through our cycle where we have to continue
24 to pay this for five years, we feel that we have started
25 early and we should receive some type of consideration for
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1 it.
2 CHAIRPERSON LLOYD: I would like to take maybe
3 Ms. Witherspoon up on the suggestion that in this
4 particular case staff continue to work with the city and
5 see if we can come up with a mutually satisfactory
6 agreement and maybe report back to us on that.
7 BOARD MEMBER RIORDAN: I think that's only fair,
8 Mr. Chairman.
9 CHAIRPERSON LLOYD: Ms. D'Adamo.
10 BOARD MEMBER D'ADAMO: I just had a question on
11 one of the witness' last points. I'm not sure I
12 understood it, about the emergency situation with the
13 vehicle having to pull over. Could staff respond to that?
14 MR. MENDOZA: As it states is that it cannot
15 operate on diesel at any time. We are only asking for the
16 modification on these 77 trucks to allow us to limp home
17 or run on diesel, you know, when they stall, rather than
18 stalling in the middle of the road and having them towed
19 in.
20 EXECUTIVE OFFICER WITHERSPOON: The issue is that
21 we've defined BACT in the regulation to include
22 alternative fuel vehicles that are pure alternative fuels.
23 So this particular product does not meet our BACT
24 definition. You have two things you can do about that.
25 One is to change the BACT definition, which we would
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1 oppose. And the other is to craft a different sort of
2 exemption, a different kind of flexibility that recognizes
3 the unique characteristics of these vehicles. They have a
4 limp home mode and in pure diesel operation are not
5 uniformly alternative fuel vehicles.
6 CHAIRPERSON LLOYD: Thank you. Professor
7 Friedman.
8 BOARD MEMBER HUGH FRIEDMAN: Is this a unique
9 situation?
10 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: There
11 have not been a real large number of these types of
12 engines sold, and the company that makes them happens to
13 be in San Diego. So I think that their market has been
14 more received in that area.
15 BOARD MEMBER HUGH FRIEDMAN: But it's not a broad
16 widespread problem?
17 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Not
18 real broad, no. I don't think that exact technology is
19 even being manufactured any more, if I'm correct.
20 There are different types now that have better
21 environmental qualities. But the issue with this is that
22 the vehicle actually runs on both fuels all the time. The
23 limp home mode thing is what happens if you run on natural
24 gas. It can get home on diesel. That's something we can
25 deal with.
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1 But if you look at the emission levels of the
2 engines, they're certified at about half of the standard
3 that a normal diesel would be. But that's the same
4 standard, by the way, that transit buses are certificated
5 to. And we're requiring transit buses to retrofit with
6 particulate filters as well. So these match the newer
7 transit bus performance, and we require that retrofit on
8 them.
9 So I think the issue from our standpoint would be
10 to try to take a look at the timing. And when you see
11 these 25, 50, 75, 100, maybe there's a way of shoving them
12 to the end and giving them more time to spread out the
13 money because they did do things to try to get the NOx
14 emissions down voluntarily early on. And maybe that's an
15 equitable way of dealing with the engines. We could do
16 that, with your direction in 15 days try to craft
17 something that would make --
18 CHAIRPERSON LLOYD: Would that seem to be
19 promising?
20 MR. MENDOZA: Sure. That's great. Anything
21 would be promising. We really don't have anything at all.
22 So any consideration we would be -- would be given --
23 especially in light of the state's budget, our department
24 got cut $1.7 million this year, so we're scrambling.
25 Anything you could do would be very helpful.
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1 CHAIRPERSON LLOYD: I think we could direct the
2 staff to work closely here and see about the issues Tom
3 was raising as well. Thank you very much.
4 MR. MENDOZA: Thank very much, Dr. Lloyd, Board.
5 CHAIRPERSON LLOYD: Frank Caponi, Jed Mandel,
6 Emily Brown.
7 MR. CAPONI: I'm Frank Caponi, and I'm
8 representing the L.A. County Sanitation Districts. We
9 support ARB's efforts in reducing diesel PM. In fact, we
10 are part of ARB as well as the South Coast AQMD in testing
11 PM removal technologies as well as alternative engines on
12 both off-road and on-road vehicles.
13 The card that Dr. Lloyd has in front of him
14 presents us in opposition to this rule. I'm willing to
15 remove that opposition conditionally pending some changes
16 to the rule. We support generally the -- we support the
17 staff's recommendations. I think Yvonne Hunter had put it
18 appropriately when she said that the municipalities cannot
19 be the enforcement arm of the ARB or any regulatory
20 agencies. That's really what we're here today to speak
21 to.
22 The San district does not operate any residential
23 or commercial collection vehicles. We are here, though,
24 to represent our -- or speak for our member cities as well
25 as our local governments. These governments and local
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1 cities cannot be held to enforce the rules of the ARB or
2 any regulatory agency.
3 But also it's important that I think we have an
4 opportunity today to get this right because we're not only
5 speaking of this rule, but there will be other rules
6 coming up before you that will address retrofitting out
7 fleets and holding municipalities responsible. So with
8 that regard, we hope that you accept the staff's
9 recommendations.
10 Just some specifics about the staff
11 recommendations, on Section 2020, they propose to change
12 some definitions as necessary. We cannot support that
13 language. We do not support any definition that we don't
14 have in front of us and that we can't see the actual
15 language. So hopefully in the next 15 days we can see
16 that language and fully support the rule.
17 We support all of the revisions that remove any
18 of the compliance on the part of the municipalities.
19 You've heard some previous testimony about reports --
20 reporting requirements that the municipalities will still
21 need to make. We hope you will listen to those comments.
22 We don't think there should be any reason for any
23 duplicative requirements of the municipality. If they're
24 collecting this information from other sources, then
25 that's where the collection should be. We shouldn't have
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1 dual reports here.
2 And then finally, there's a Section D of 2021
3 which holds the municipalities similarly responsible for
4 incorrect information. The municipality really cannot be
5 held to bad information that's given to them by haulers or
6 any other sources. So in concert with removing some of
7 the other provisions, we also support the removal of
8 Section D.
9 And with that, as I said, we would remove our
10 opposition and fully support the rule. Thank you very
11 much.
12 CHAIRPERSON LLOYD: Thank you.
13 Comments from staff?
14 EXECUTIVE OFFICER WITHERSPOON: It's the same
15 comment as before. It's the completeness issue for
16 enforcement. It would be our intent to only go to a
17 penalty choice when a local government was not reporting
18 about its own vehicles accurately -- about its own
19 vehicles, but not to seek to reach through them to the
20 haulers.
21 CHAIRPERSON LLOYD: Thank you.
22 Jed Mandel, Emily Brown, David Huerta.
23 We were just confused here, Jed, looking at your
24 letter and looking at what box you checked.
25 MR. MANDEL: It's always prudent to be neutral
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1 before this Board.
2 (Laughter)
3 CHAIRPERSON LLOYD: You think you'll get better
4 treatment if you put neutral rather than opposed?
5 MR. MANDEL: I think I know better than that.
6 But as you'll hear in a moment, one of the reasons we're
7 neutral is because we are strong proponents of the
8 retrofit programs. We have concerns about some of the
9 implementation issues of this particular proposal.
10 But for the record, my name is Jed Mandel. I'm
11 here today on behalf of the Engine Manufacturers
12 Association. EMA's members include principal
13 manufacturers of the diesel fuel and alternative fuel
14 engines used in the solid waste collection vehicles
15 covered by today's proposal.
16 As I said a moment ago, as I hope you are all
17 aware, EMA is a strong proponent of retrofit programs. We
18 are committed to working with ARB to develop a voluntary
19 incentivized retrofit program and other programs as a key
20 component of ARB's overall air quality improvement
21 strategy.
22 EMA supports retrofit programs that are
23 cost-effective, workable, and incentive-based, as opposed
24 to mandatory programs that enforce replacement, rebuild or
25 retrofit of engines before it makes economic or regulatory
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1 sense to do so.
2 The proposed rule is a mandatory program, and
3 therefore I am opposed to it. EMA is opposed to it. But
4 we do think it could be modified and become an
5 incentivized program, which we would support. In
6 addition, as we detailed to you in separate written
7 comments that were submitted to the record before the
8 Board, the proposed rule is inconsistent with both federal
9 and state law. Even if the proposed rule were authorized,
10 it is seriously flawed because it fails to require the
11 availability and use of ultra low sulfur diesel fuel, a
12 subject that I've spoken to you about on many different
13 occasions. But with retrofit programs, I think you know
14 how strongly we support the use of clean diesel fuels.
15 At present, ultra low sulfur diesel fuel will not
16 be required on a statewide basis until September 2006.
17 The proposed rule, however, would be implemented sooner.
18 Without the availability of ultra low sulfur diesel, the
19 desired PM retrofit technologies cannot function. ARB has
20 recognized the linkage between the availability and use of
21 ultra low sulfur diesel as an enabler of PM retrofit
22 technology on many occasions and specifically in the urban
23 bus rule. In that rule, the staff worked to assure that
24 ultra low sulfur diesel would be available for transit
25 fleets and adopted a rule requiring the use of ultra low
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1 sulfur diesel. You should do the same here.
2 Despite our concerns about the rule, engine
3 manufacturers want to work with ARB to implement cost
4 effective, voluntary programs and encourage fleet owners
5 to turn over and upgrade their motor vehicle fleets to
6 lower-emitting technologies as soon as practicable. EMA
7 fully recognizes the potential benefits created by
8 applying new technology to existing engines. Engine
9 manufactures who develop and are developing new
10 technologies, many of which have applications existing
11 designs. Voluntary incentivized retrofit programs can be
12 a cost effective and practical tool for heaving emission
13 reductions and should be a key component of ARB's overall
14 program.
15 It would be our recommendation that the Board
16 direct the staff to implement this and similar retrofit
17 programs that you'll be hearing in October. I believe
18 there's one in November. It's the United Airlines Full
19 Travel Act, I think, coming back here to see you
20 frequently. But we would encourage you to direct the
21 staff to work with all stakeholders on an effective and
22 voluntary incentivized program instead of a mandatory
23 program. I'd be pleased to answer any questions.
24 CHAIRPERSON LLOYD: Thank you. Any questions or
25 comments?
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1 You're saying you want to work voluntarily. We
2 trust you to work with us. This is the same industry that
3 we're going to come back in a few months and see how you
4 complied with the consent decree.
5 MR. MANDEL: There are members of the industry
6 who are subject to that consent decree. But the industry
7 as a whole, including those manufacturers, they are
8 absolutely committed and incentivized to retrofit-type
9 programs. And just to give you some sense, we are working
10 literally as we speak on developing a program that we can
11 roll out on a nation-wide basis, which obviously there
12 would be very significant benefits to California. We're
13 very serious about doing this. We're trying to figure out
14 a way for it to make the most economic sense. Obviously,
15 there's a question of who pays for it and how it gets paid
16 for. But as the cliche goes, we think the program has
17 legs. We're very concerned about the way in which it's
18 implemented on a mandatory basis and obviously concerned
19 about the statutory authority in California.
20 CHAIRPERSON LLOYD: Can we ask Ms. Walsh to
21 comment on that?
22 GENERAL COUNSEL WALSH: Yes. Mr. Mandel has
23 raised two issues, one having to do with federal law.
24 Under federal law states are generally preempted from
25 adopting standards for new motor vehicles and motor
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1 vehicle engines. Of course, California enjoys the ability
2 to have a waiver of that preemption. In this case we're
3 not really travelling on that ground in any event. The
4 regulations for the most part affect used vehicles,
5 vehicles that are in use. And there is no federal
6 preemption that would effect this Board's ability to
7 regulate in that arena.
8 State law gives this Board ample authority to be
9 addressing this particular problem of diesel PM. In the
10 statutory provisions for addressing toxic air containments
11 such as particulate matter, there's specific authority to
12 adopt regulations that apply best available control
13 technology to motor vehicles and motor vehicle engines in
14 a written comment submitted on behalf of EMA. There's an
15 intimation there that authority is limited to new motor
16 vehicles. But that's based on some language taken from
17 the statute out of context. The statute itself is very
18 broadly drawn in terms of this Board's authority. And
19 there's no question that we have the authority to address
20 PM emissions -- toxic PM emissions from used motor
21 vehicles in a fashion that staff has proposed.
22 There is a statutory provision that is sited also
23 in the written comments from EMA related to the use of
24 certified devices on in-use vehicles. That statute, which
25 does provide a limitation that requires specific statutory
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1 authorization to require those types of devices on used
2 vehicles, was adopted by the Legislature pre-1975 and a
3 very specific factual context that does not apply here.
4 We now are in a world where since that statute
5 was adopted, we have not only the Toxic Air Contaminant
6 Act, which is a 1983 vintage statute with clear direction
7 to this Board to attack the emissions of toxic air
8 contaminants from motor vehicles, new and used, also
9 provisions in state law in the same chapter that the
10 specific NOx device language cited in the EMA's letter
11 comes from which directs this Board to attack emissions
12 from used heavy-duty diesel vehicles with a specific
13 direction to adopt maximum controls for those vehicles,
14 and this would be used vehicles. That statute is a much
15 later adopted statute. And to the extent Section 43600
16 would require specific legislative authority, I think you
17 have it there in Section 43701 to do exactly what staff
18 has proposed here.
19 CHAIRPERSON LLOYD: Thank you.
20 Comments?
21 Dr. Friedman.
22 BOARD MEMBER WILLIAM FRIEDMAN: Can we get a
23 comment about the low sulfur issue? According to the
24 numbers that I asked for earlier, about 13 percent of the
25 vehicles are to be -- implementation is to occur prior to
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1 uniform low sulfur diesel being available. What is
2 staff's comment about that?
3 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
4 HEBERT: Well, if you look at best available control
5 technology there was instances where the operators/owners
6 can choose solutions that do not require the use of ultra
7 low sulfur diesel fuel. There is technology in our
8 verification pipeline that are emitable to commercial
9 diesel fuel and ultra low sulfur diesel fuel. So we
10 decided not to force the fleet-wide use of ultra low
11 sulfur due to various issues about delivery, you know,
12 price increases or above the standard commercial diesel
13 fuel price. So we decided to leave it up to the owner in
14 selecting which technology you wanted to go with or which
15 option you wanted to go with, whether or not you would
16 switch over to ultra low ahead of the 2006 schedule.
17 EXECUTIVE OFFICER WITHERSPOON: The regulation
18 also carries within it the authority of the Executive
19 Officer to waive the device requirement if the fuel is not
20 available. And so we already know what the current
21 distribution of the diesel fuel is, and it would be sort
22 of an automatic process. If these fleets were located in
23 far flung rural areas, we couldn't even contemplate going
24 to the trap requirements until the fuel is there. And
25 either that would cause us to grant the one-year exemption
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1 or to say just don't do Level 1 or talk about other
2 possibilities like the rebuilds and the retirement.
3 CHAIRPERSON LLOYD: Ms. D'Adamo.
4 BOARD MEMBER D'ADAMO: How is a fleet operator to
5 know what to do as far as timing? I imagine we're not
6 going to know and neither are they until they're butting
7 up against a deadline, specifically in a situation where
8 you expect it may become commercially -- the fuel may
9 become commercially available.
10 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: I think
11 one thing is that in the major urban areas the fuel is
12 virtually available now, and virtually anybody can get it.
13 So for the vast majority of these vehicles, we know fuel
14 is there. And these are secondary fuel vehicles. They
15 can use low sulfur, should they choose to go with trap
16 retrofit approach on some of the vehicles. And, of
17 course, that is only essentially two-and-a-half years away
18 before it would be the only fuel in the marketplace.
19 So what we're dealing with here is the need in
20 some limited instances to perhaps give these one-year
21 exemptions to let people that are having trouble getting
22 into rural areas, et cetera, delay until mid '06, in which
23 case the fuel is available. And that's no longer an
24 issue.
25 EXECUTIVE OFFICER WITHERSPOON: I asked staff to
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1 put the schedule back up so you can see the years in which
2 the control requirements hit for the different model year
3 realms. We're talking about that '88 through 2002 family
4 with four and five implementation dates and low
5 percentages where traps are certified, and traps are only
6 certified now for '94 and newer.
7 BOARD MEMBER WILLIAM FRIEDMAN: That's 13 percent
8 of the total, according to the numbers you gave me before,
9 are involved in that number. Because you told me there
10 were over 50 percent of all these vehicles in that '98 and
11 2002 category, and now you're talking about 35 percent or
12 55 percent. That's 1,000 vehicles.
13 EXECUTIVE OFFICER WITHERSPOON: What I'm getting
14 at is that where traps do not exist, either they are not
15 required at all and you move to another BACT
16 interpretation, such as rebuilding the engine or
17 repowering the engine -- I mean or replacing the vehicle,
18 if there's a hard requirement to comply or the trap is
19 available but the fuel is not, in which case the trap
20 installation requirement can be waived based on the
21 geographical location of the fleet until fuel is
22 available.
23 BOARD MEMBER WILLIAM FRIEDMAN: It sounds like
24 there's going to have to be --
25 MR. MANDEL: It makes no sense. There is ultra
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1 low sulfur diesel generally available all to states. It
2 makes sense to require its use, at least choosing to use
3 PM aftertreatment technologies, which are very cost
4 effective, reasonable approaches. That is required.
5 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: It is
6 essentially required because the way BACT works is if the
7 trap is available, a filter is available for one of your
8 engines. And that group you're talking about, Dr.
9 Friedman, that's the '94 and newer one. If it's
10 available, then you use the device. And you can only use
11 the device if the fuel's available. So what's going to
12 happen in most of the areas the fuel is available, the
13 decision that you have to use the device means you have to
14 switch to ultra low sulfur fuel. And it's only in those
15 instances where it's simply not available at a reasonable
16 price in that area, which is outside the major urban areas
17 there would be a need to say, "Well, gee, without the
18 fuel, you can't use the device."
19 The choice is at that point would be go to a
20 lower efficiency device or get a delay because the fuel is
21 not available. No device works on your equipment. And
22 that, of course, delay would only be good until '06
23 because that's when everybody has it available to them.
24 And if you look at the phase-in, you can see
25 there's flexibility to move the vehicles around. By '06
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1 you're only doing 50 percent in that period. So if you're
2 having problems and you want to avoid the trap because you
3 can't get the fuel for a couple of years, you can focus on
4 some of the other vehicles that have retrofit or other
5 options available that don't require low sulfur fuel.
6 There's flexibility here to get around most of the
7 situations, and I think there will be relatively few.
8 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: I'll
9 remind you of the concern staff has is the pricing of the
10 fuel when you get into mandating. As you try to mandate
11 it, you get in situations where folks have copied markets,
12 and the waste haulers are concerned about that.
13 CHAIRPERSON LLOYD: Yes, Mr. Calhoun.
14 BOARD MEMBER CALHOUN: You mentioned the fact
15 that the industry is currently working on a program to
16 roll out nationwide. Is that a retrofit program?
17 MR. MANDEL: Yes.
18 BOARD MEMBER CALHOUN: When do you expect to have
19 it in place?
20 MR. MANDEL: I'm hesitant to over-promise because
21 we are really looking at developing it now and asking for
22 proposals from contractors and consultants to work with us
23 how to do it. So in fairness, I think we're still a bit
24 away from being able to share with you the details of it,
25 but we are -- it is on our agenda. We are working on it
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1 as we speak. And I suspect being able -- before we can
2 come back to you and have some -- we still might be
3 six months to a year away. This is not an insignificant
4 program as you can imagine.
5 CHAIRPERSON LLOYD: This really is an incentive
6 to keep you on track in that process.
7 MR. MANDEL: You may want to look at it that way,
8 yes. If I could, Dr. Lloyd, just make one brief comment.
9 I know you're running short of time. I do want to take
10 some credit to make sure that we engage Kathleen today on
11 her last day of work. So you know, we're going to miss
12 her, and take one opportunity to express to her our best
13 wishes. We've enjoyed working with her and wish her very
14 well.
15 CHAIRPERSON LLOYD: That's very nice of you.
16 Again, I would like to also to thank the industry for its
17 continued progress, continued work with us on the very
18 important issue. So in fact, we are coming to these much
19 cleaner diesel engines with retrofits as well as. So we
20 appreciate that.
21 MR. MANDEL: Thank you. We'll continue to work
22 on that.
23 CHAIRPERSON LLOYD: Emily Brown, David Huerta,
24 Graham Noyes.
25 MS. BROWN: Good morning. First, I'd just like
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1 to say the proposed measure set forth the vital vision of
2 replacing the high diesel vehicles in most California
3 communities with cleaner trucks. And for this, I think
4 the ARB should be commended. I say this in spite of
5 Inform's overall opposition to this bill as written.
6 My name is Emily Brown. I'm a research policy
7 associate at Inform. I'm here today to briefly summarize
8 the full written testimony of our Senior Research Fellow,
9 Jim Cannon, which was submitted electronically this week.
10 Inform is a national nonprofit environmental
11 research organization that analyzes alternative fuel
12 vehicles, advanced technologies, and the public policies
13 that can ensure the most rapid progress towards the area
14 of sustainable transportation.
15 Inform's most recent focus has been on the U.S.
16 refuse truck sector. Our 2003 report, "Breathing Garbage
17 Trucks, New Technologies For Cleaner Air," is the first
18 independent assessment of local environmental impacts of
19 this predominantly diesel vehicle sector and the
20 opportunities for change. Two of the major findings of
21 Inform's report are that refuse trucks, one of the oldest
22 and most polluting vehicle sectors in the U.S., should be
23 an extremely high priority target for pollution reduction,
24 and also that natural gas is the cleanest fully-commercial
25 vehicle technology for the sector.
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1 It should come as no surprise to anyone here that
2 California was the site of 92 percent of the nearly 700
3 U.S. natural gas refuse trucks identified by Inform in
4 late 2002. Twenty-three distinct natural gas programs
5 were operating in California at that time. And since the
6 publication of our report, seven new natural gas refuse
7 truck projects have emerged in the state.
8 The use of the natural gas in these refuse trucks
9 is already helping California achieve three critical
10 public policy objectives. First, of course, it is
11 reducing air pollution. This is not only PM, the focus of
12 this rule, but also nitrogen oxides and hydrocarbon. And
13 it's doing this with engines that are up to 98 percent
14 quieter than diesel trucks. Secondly, the use of natural
15 gas in refuse trucks is helping California achieves its
16 goal of reducing the state's dependence on foreign oil.
17 And finally, expanded use of natural gas is propelling
18 California along the road to a hydrogen cell future due to
19 the synergies between these fuels.
20 Regulatory agencies in California have played a
21 role in the progress to date by providing strong
22 regulations and incentives that have driven the
23 alternative fuel vehicle market. A pioneering role for
24 the refuse truck sector from the Air Resources Board could
25 provide vital support for the shift to clean alternative
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1 fuel vehicles that is already underway. Unfortunately, by
2 focusing almost exclusively on diesel technology, the
3 current version of the program assumes a diesel fuel
4 future for the sector and misses a vital opportunity to
5 truly promote the best available technologies for PM
6 emission reductions reflected in an equally viable
7 alternative fuel --
8 BOARD MEMBER HUGH FRIEDMAN: Ms. Brown, you're
9 allotted time has expired. Could you --
10 MR. BROWN: The Air Resources Board can shape a
11 much more effective regulation by eliminating the third
12 path, best available control technology definition; by
13 eliminating the program exemptions for fleets pursuing the
14 diesel path; by shortening the program implementation
15 period and eliminating the automatic extension for the
16 oldest and dirtiest programs; and by strengthening the
17 benefits to operators choosing to switch to alternative
18 fuels. Thank you.
19 BOARD MEMBER HUGH FRIEDMAN: Any questions?
20 Comments?
21 Mr. Huerta, city of Fremont.
22 MR. HUERTA: Good morning. My name is David
23 Huerta. I'm with the Environmental Services Division of
24 the city of Fremont. We're pleased with the proposed
25 changes that staff has made that will pull the city out of
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1 the enforcement role that had been envisioned earlier.
2 It does leave one small concern that still we
3 have to deal with, which is we just recently negotiated a
4 contract with our waste hauler, and the contract contains
5 provisions for the use of an alternative fuel engineered
6 to reduce emissions. And this cost has already been
7 rolled into our contract. So with the overlay of
8 additional rules, it's going to make it rather complicated
9 to try to separate out exactly how much it costs. That
10 is, how much this is going to cost. This will also be
11 even more complicated since we're getting radically
12 different information as to cost estimates from our
13 hauler. I just would hope that this information is taken
14 into consideration. Thank you.
15 BOARD MEMBER HUGH FRIEDMAN: Any question or
16 comment?
17 Thank you.
18 Mr. Noyes, and then Stephanie Williams.
19 MR. NOYES: Good morning, members of the Board.
20 Graham Noyes from World Energy. We're the largest
21 supplier of biodiesel in the country. I had a brief
22 presentation to give -- that basically focuses on an
23 alternative measure, basically alternative performance
24 based option that we have throughout the process --
25 particularly over the last six months or so been strongly
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1 recommending as a way to build some additional
2 flexibility, some more cost effectiveness, while actually
3 realizing larger PM reductions than the rule would as
4 proposed now.
5 (Thereupon an overhead presentation was
6 presented as follows.)
7 MR. NOYES: I will be speaking using biodiesel as
8 an example, and biodiesel's verified federal reduction
9 numbers as an example. But this option would be equally
10 available using the pure NOx and aquazol, potentially a
11 Fisher-Tropsch if it went through the CARB program.
12 --o0o--
13 MR. NOYES: I'm going to move through this
14 presentation very quickly because I appreciate your time
15 restraints on this. On this slide, the key factor is on
16 the CARB verification program for alternative diesel fuels
17 that were going through. They're still in the process.
18 That is not complete. So I'm using the federal
19 verification numbers that have been confirmed and
20 complete.
21 In terms of where biodiesel now is in the waste
22 collection industry. It's been used for years quite
23 successfully by a large number of fleets that are in
24 support for it because it's essentially a fuel retrofit
25 option.
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1 --o0o--
2 MR. NOYES: In formulating this proposal, what we
3 tried to do was use the existing rule as a floor,
4 recognize all of CARB's goals in this, and not sacrificing
5 any of those goals. In particular, at least hit the PM
6 reductions that the proposed rule in its present form
7 would; not increase NOx or any other emissions; utilize
8 CARB procedures to determine what alternative fuels would
9 contribute to this; reduce the compliance at least to some
10 fleets; compliance cost to some fleets; and also provide
11 the collateral benefits that alternative diesel fuels can
12 provide in terms of reducing petroleum dependence and
13 global warming contribution.
14 --o0o--
15 MR. NOYES: Our change was basically a
16 performance-based option that said given the inventory of
17 the particular fleet, if that fleet should choose to use
18 an alternative diesel fuel that's completed CARB's interim
19 procedure for certification of emission reductions for
20 alternative diesel fuels and that fleet can show that the
21 PM reductions that they would achieve using that
22 alternative fuel fleet-wide would equal or exceed the PM
23 reductions that the schedules would provide, they be
24 allowed that option. Essentially, if they can reduce PM
25 as much through another route that's CARB approved, they
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1 should be entitled to do that.
2 --o0o--
3 MR. NOYES: The details of this have been
4 submitted to CARB staff. We're not going to do a lot of
5 math up here. Just provide the chart and summaries. To
6 date, I have not heard that any of the technical analyses
7 was incorrect, and I have built in the assumptions into
8 this presentation so they are obvious and straightforward.
9 BOARD MEMBER WILLIAM FRIEDMAN: Your time has
10 elapsed so if you can complete the presentation.
11 MR. NOYES: Very good. I'll move through it even
12 quicker than I have been already. I do think this is a
13 very significant topic.
14 BOARD MEMBER WILLIAM FRIEDMAN: It is. And we do
15 have in writing your correspondence, two pages.
16 MR. NOYES: Very well. I'll move through very
17 quickly.
18 We used all of the CARB exemptions in terms of
19 vehicle inventory, in terms of emission standards, in
20 terms of what the PM reduction would be realized within
21 the CARB program. And the key thing to look at here is
22 the first three years. The most difficult years for
23 implementation where a B20 solution can reduce PM
24 significantly.
25 --o0o--
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1 MR. NOYES: This shows it in chart form over what
2 the current CARB plan would do. If you add up the
3 difference between the first three years of the B20 and
4 the first three years of the best available control
5 technology, you see for this fleet a 700 pound reduction
6 in PMs. If you carry that out over the entire inventory,
7 as specified in the CARB report, you're talking about 139
8 tons of PM reduction that this option could deliver.
9 --o0o--
10 MR. NOYES: And this translates at the 14.11 ton
11 rate to reducing 10 premature deaths of the methodology
12 contained in the reports.
13 --o0o--
14 MR. NOYES: It's a win for the industry, cost,
15 flexibility and proven technology that they can switch to
16 overnight.
17 --o0o--
18 MR. NOYES: It's a win for CARB because CARB can
19 get after the older vehicles that are not available for
20 retrofits. So it will enhance the PM reduction. It will
21 achieve CARB's other goals, and it will show that CARB is
22 flexible to consider alternatives and has a respect for
23 cost concerns.
24 I appreciate the extra time.
25 BOARD MEMBER WILLIAM FRIEDMAN: Thank you,
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1 Mr. Noyes. Has that been presented to staff, Mr. Noyes?
2 EXECUTIVE OFFICER WITHERSPOON: Yes. We've been
3 aware of this issue for some time.
4 BOARD MEMBER WILLIAM FRIEDMAN: And you've taken
5 this into account?
6 EXECUTIVE OFFICER WITHERSPOON: We have taken it
7 into account. The regulation as proposed by staff does
8 allow biodiesel to qualify as Level 1 and Level 2 controls
9 as a 25 percent, 50 percent control respectively. And as
10 Mr. Noyes indicated, they're in the verification process
11 now of certifying exactly what the return is.
12 I think the difference between us is that he'd
13 have staff move to an overall fleet average approach
14 instead of the model year groupings in BACT approach we
15 have recommended instead. We have issues about
16 enforceability with changing the structure of the rule.
17 We have issues of the resources that would be demanded of
18 the staff to carry that out as we move from a fleet of 700
19 companies to ever larger numbers as we continue moving
20 through the diesel risk reduction plan. So generally
21 speaking, it's not manageable for us, but we have not
22 precluded the use of biodiesel as a compliance option
23 within the rule we have recommended to you.
24 BOARD MEMBER WILLIAM FRIEDMAN: Any comments or
25 questions from the Board?
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1 Thank you, sir.
2 MR. NOYES: If I can simply follow up on that
3 point. In terms of compliance, we currently certify fuel
4 purchases for U.S. military, utility companies, state
5 fleets. It's one of the easiest compliance techniques
6 available. Biodiesel, pure NOx, probably Fischer-Trophs
7 will not hit that 25 percent floor. That 25 percent floor
8 is an arbitrary floor, and it's inhibiting the ability of
9 CARB to reduce its PM reduction.
10 BOARD MEMBER WILLIAM FRIEDMAN: Do you want to
11 respond?
12 EXECUTIVE OFFICER WITHERSPOON: Yeah, if I might.
13 When I indicated that biodiesel could qualify, I was
14 referring to B100, which isn't used as much because it's
15 more costly. And B20 probably does not rise to the level
16 of our first incremental control, which is at least 25
17 percent reduction in emission. B20 would not hit that.
18 I think one of the other things that concerned
19 staff is that all the biodiesel products increase NOx
20 emissions. This is a particulate matter control measure,
21 but we don't think it's detrimental the way we structured
22 it to NOx. We're going to get concurrent NOx reductions
23 in the 15 percent to 30 percent range. But were we to
24 create a pathway for biodiesel itself, for PM only, we
25 would have a NOx benefit. That would be something you had
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1 to consider and mitigate.
2 BOARD MEMBER WILLIAM FRIEDMAN: Thank you again.
3 MR. NOYES: We were extremely concerned about
4 that as well.
5 BOARD MEMBER WILLIAM FRIEDMAN: Sorry?
6 MR. NOYES: The verification measure -- the CARB
7 verification measure in place for any of alternative
8 diesel fuels, including biodiesel, would be NOx. And
9 there is no NOx risk. The fuel would not be certified if
10 it was raising NOx. Thank you.
11 BOARD MEMBER WILLIAM FRIEDMAN: Ms. Williams.
12 CHAIRPERSON LLOYD: And then Tim Ward and Kelly
13 Astor.
14 (Thereupon an overhead presentation was
15 presented as follows.)
16 MS. WILLIAMS: Good afternoon.
17 CHAIRPERSON LLOYD: Good morning.
18 MS. WILLIAMS: Is it morning still? I'm hungry.
19 CTA submitted on the CARB's diesel retrofit
20 reduction plan on August 25th, 2002 -- you remember, Alan,
21 we carefully supported the retrofit in noncompetitive
22 trucking fleets and for additional costs to be passed on
23 to the shipper or user. This is still our position. It's
24 approved by our Board. We support a voluntary and
25 subsidized program. We recommend any regulation be tied
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1 to funding source and any particulate trap or device would
2 not exceed the 2006 PM standard.
3 --o0o--
4 MS. WILLIAMS: On the current rule, we have
5 issues with the warranties still. They fall on the backs
6 of the users, the smallest economic unit. We have -- the
7 Board recommendations to address warranty -- the issues
8 have not been provided in this rule that -- and have not
9 relieved the trucking industry's liability when something
10 goes wrong. It was supposed to be handled in the first
11 rule. As you remember, we talked about the verification
12 procedures. We had a long discussion at the Board hearing
13 about the warranties. The CARB staff was supposed to come
14 back at that time and say what the cost effectiveness
15 based on the warranties -- Ms. D'Adamo asked them to come
16 back at 150, 300, and 450 in the rule making. It hasn't
17 been done.
18 We have very significant concerns about the
19 warranty issues and that they fall on the end user rather
20 than the manufacturer -- the engine manufacturers and the
21 trap manufacturer working on the liabilities in the time
22 failure.
23 The fuel supply issue is further boutiqued by
24 having a year period where vehicles that could use traps
25 and should be buying traps for the future because they are
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1 qualified -- they're part of the 12 or 13 percent that
2 could use particulate traps, would be encouraged to use
3 some other technology rather than wait until 2006 when the
4 fuel is available. Put the trap on, and put the money
5 there in 2006 would be better for the environment and for
6 cost effectiveness of the companies.
7 And the last-minute attempt to exempt
8 municipalities from the responsibility, this is the
9 shipper, which pays the bill. This is like having Walmart
10 or Target come in and say, "We're not going to pay you
11 more to ship these goods just because CARB diesel costs
12 more, because the national average is 30 cents less, and
13 we're not going to pay you." So I think this is
14 incredibly bad for the waste industry. It's incredibly
15 bad for the trucking industry.
16 We find out about it at the last minute. No
17 notice. We find out the 15 days -- why? Why would you
18 exempt the people who pay the bills? This is the shipper.
19 They have to say, "We're going to pay more, and we're
20 going to pass it on to the customer." If they don't make
21 that decision, we have no control.
22 So the cost analysis is incomplete and
23 underestimated. The retrofit devices are $9500 for a
24 vehicle, $1500 to put on a device that detects when
25 there's pressure problems. And it costs money to take the
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1 vehicle out of the service.
2 Incremental fuel costs we talk about over and
3 over again. And the ability to cite the retrofit and
4 reengine in California state law is problematic.
5 I'm going to skip through some of these because I
6 know I only have three minutes.
7 --o0o--
8 MS. WILLIAMS: Regulatory authority, the sections
9 provided do not say anything about retrofit. In fact,
10 they actually demonstrate that you don't have authority
11 for anything but new emissions, in-use standards, idling,
12 motor vehicle fuel specifications. There's no retrofit
13 authority provided in the sections that ARB has used. And
14 in fact, the section that we found that are above and
15 beyond what ARB used, 43600, these have to be the smoke
16 testing statutes they we're familiar with. This is right
17 in that section where we went to court in 1991. Section
18 43600 specifically prohibits insulation devices on used
19 motor vehicles, unless mandated by the statute. That's
20 because we don't want 100 different devices on vehicles.
21 And no offense to the speaker before me, but a
22 bunch of sales people at our office is telling, "This is
23 the mandated device. You have to buy this. The state
24 said you have to." How are we supposed to know which
25 device is mandated? We have no direction. There's no
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1 regulations. This puts a serious and incredible burden on
2 the end user that should not be there.
3 Section 43701, which is part of this smoke
4 testing program, specifically requires that any
5 significant modification of the engine should be made
6 during maintenance or overhaul of the vehicle engine.
7 That's California statute. Not that you couldn't get a
8 bill passed, but you need to.
9 --o0o--
10 MS. WILLIAMS: Just to let you know what the
11 field prices are today, we're about 36 cents more than San
12 Francisco, the Oregon corridor. We're about 18 cents
13 between Arizona and L.A. We're about 30 cents between San
14 Diego and Arizona. So we haven't resolved the issue on
15 fuel prices between California carriers and the boarder
16 states, New Mexico borders, and moving to be open quickly.
17 We really want to get this accomplished. We are really
18 are at a competitive disadvantage.
19 CHAIRPERSON LLOYD: Can you -- you've been about
20 five minutes.
21 --o0o--
22 MS. WILLIAMS: Changes to the rules. This is my
23 last -- this is the municipalities' free ride, the shipper
24 getting a free ride. This is like the port saying, "We're
25 not going to pay you anymore to carry those containers.
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1 We want you to make $50 a load. We don't care if you
2 can't afford the fuel prices. We don't care if you don't
3 have health insurance. You take that load for $50 and we
4 don't care if your costs get bigger."
5 There's a difference between the port haulers and
6 any other segment of the industry. The shipper pays for
7 cost increases. They have to, or the system doesn't work.
8 We don't manufacture. We move it. They've been removed
9 from the definition of the contract.
10 They're removed from the compliance requirement.
11 They've been removed from the reporting requirement, from
12 the identification of funding sources. Why are they
13 removed from the identification of funding sources? If
14 they're saying no -- in Orange County they say "no new
15 taxes," and the waste hauler there says, "We have to do
16 this." And they say, "We're not going to give you any
17 more money," somebody needs to know.
18 Removed from the refusal to comply. Removed from
19 the notification of Executive Officer. The shipper has
20 been removed on a 15-day notice period. Nobody's been
21 notified. This has a significant impact on labor too
22 because there's only so much money in the company. That
23 either goes to drivers or environmental -- it doesn't go
24 to both places.
25 --o0o--
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1 MS. WILLIAMS: So here's the copy of the removals
2 that we found.
3 And our last point is the questionnaire that went
4 to municipalities is very biased. And the information
5 collected is very biased. This is the questionnaire.
6 These are the actual questions. What is the term of the
7 contract? How many years does the contract have left?
8 How many automatically renew unless cancelled? Does your
9 contract have a provision to allow for negotiation rate
10 increases during the contract term? Do they? How many?
11 How come we don't have this data?
12 How long would it take to negotiate a rate
13 increase once a new rule's adopted? Are there any other
14 conditions in your contract that allow for a rate
15 increase? Based on the review of your proposed rule, will
16 your agency require additional resources to comply with
17 this rule?
18 We know it's going to cost a lot of money to
19 retrofit. Of course, they're going need additional
20 resources. They're going to have to pass it on to the
21 consumer. Help us pass it on to the consumer.
22 And the last question, which is in bold because
23 it's very problematic, ARB has been asked by the refuse
24 industry to consider changes, changing the regulation to
25 place all of the responsibility -- rather than sharing the
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1 responsibility -- for compliance on the municipality
2 holding the contract -- the shipper -- with no
3 responsibility on the vehicles' owner. What would be your
4 response to this proposal? How do you think this could
5 affect your contract? Come on. Of course, nobody wants
6 to be regulated or pay. It's unfair.
7 --o0o--
8 MS. WILLIAMS: We ask that the verification rule
9 making breakdown be moved back. It's in my comments.
10 You'll see on the warranty issue. The warranties were
11 supposed to be brought up in this rule making. In the
12 record there's nothing here on the warranty. Nothing
13 about pointing fingers between engine manufacturers and
14 trap manufacturers. And these warranties were in the
15 Board on February 13th, supposed to be part of the packet
16 and have not been.
17 And here's our proposal. That we would support
18 moving this forward -- and I think if you look behind you,
19 you can see that this -- it's minor changes to the
20 initial -- what was handed out, not in the 15-day rule.
21 But if you do not change the categories -- the translation
22 of Category 1 will be, move or sell these trucks, 1988 to
23 2002 because they cost too much to keep. Number 2 would
24 be 1960 to '87, buy these trucks, because these are what
25 you want in your fleet because this is the cheapest way to
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1 comply. And number 3, hold off purchases on 2004 and 2005
2 model years because you'll have to retrofit them.
3 This is not the message you want to send to the
4 market-based buyers of trucks. What you want to say is do
5 it in a way that's cost effective that gets the best
6 environmental benefit. This will get you there. Having
7 fuel early that costs too much is not going to get you
8 there. And having the oldest vehicles be the highest
9 market value is not going to get you there.
10 CHAIRPERSON LLOYD: Thank you.
11 Staff response quickly to the warranty issue.
12 Stephanie, when you talk about the difference
13 between out of state diesel prices and in state in this
14 particular case --
15 MS. WILLIAMS: I just wanted to let you know what
16 the prices were yesterday.
17 CHAIRPERSON LLOYD: I know you remind us that --
18 MS. WILLIAMS: I remind you that every time I'm
19 here. So next time you say it's 2 cents at the
20 Legislature and what it should be -- I've showed you over
21 and over again the differential.
22 EXECUTIVE OFFICER WITHERSPOON: The warranty
23 issue that we discussed at the time the Board adopted
24 verification procedures is whether staff had calculated
25 the costs accurately since truckers preferred to buy
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1 extended warranties, and extended warranties would be more
2 expensive than the base cost assumed in the regulation.
3 There are currently no extended warranties
4 available for these trap devices. So we cannot report
5 back to you on what the cost is and how the calculation
6 changes. They're simply not available.
7 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS:
8 There was also a substantial debate after hearing --
9 CHAIRPERSON LLOYD: Can you speak up? I don't
10 know whether it's on.
11 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS:
12 There was a lot of debate at the hearing about how long
13 the warranties are that are provided by the truck engine
14 manufacturers and how long the engines last and all of
15 that discussion where I think Stephanie was contrasting
16 the life of the trap to the life of the engine and all of
17 that.
18 I know my staff did go back and get all of that
19 information from the engine manufacturers and get back to
20 Stephanie in terms of sharing it with her for comment.
21 And I think that the basic thing we found was that the
22 engine manufacturer warranties weren't as long as she had
23 said at that hearing. I think what they were --
24 MS. WILLIAMS: Is there a way -- rather than find
25 out at the Board meetings, is there a way -- since it was
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1 supposed to be at the --
2 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: The
3 point is to get the extended warranties she talked about,
4 you had to pay. And so we basically provided all the data
5 that we had. And as Kathleen said, we do look into the
6 availability of extended warranties and they're not
7 available yet. The trap manufacturers are very aware of
8 the issue and we're working with them. But we can't give
9 you an answer today.
10 CHAIRPERSON LLOYD: It might be good to get a
11 status report.
12 BOARD MEMBER D'ADAMO: I think this is an
13 important issue. It's far beyond the issue of cost
14 effectiveness. Because I know that we're going to hear
15 testimony later today about the possibility or suggestion
16 of acceleration of the rule until the state-of-the-art
17 trucks are available so we don't have to go through this
18 issue of traps.
19 I'm concerned about the impact that these
20 retrofit devices would have on the users, not just in
21 terms of cost, but certainty issues, convenience, having
22 to go -- you know, truck manufacturer and now retrofit
23 manufacturer and trying to get the two of them to talk to
24 each other --
25 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS:
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1 That's kind of all done. I think the thing we have to
2 remember is, as staff said in their presentation, only 12
3 percent of the trucks are amenable to trap retrofit. So
4 out of all of those -- you know, and that basically
5 excludes the older ones. That's basically the 93 current
6 trucks are amenable, and it's just a few of those. And we
7 did our homework in terms of testing trucks to find out
8 which of those few were amenable to traps.
9 And so we're looking at a small sub-portion of
10 the fleet which has this concern. The traps that would go
11 on have gone through extensive testing through
12 verification process. And then they've also been
13 fleet-tested by the city of L.A. and there are 300 trucks
14 and in New York. So I think that as long as the rules for
15 properly applying the traps are followed, I don't think we
16 have a concern or a warranty concern.
17 The city of L.A. is fine. They're not having
18 troubles with them. I think when they're misapplied,
19 then, yeah, you do have problems. That's why the
20 verification requirements are so clear on what's
21 appropriate application and what isn't. But the bulk of
22 the regulation is things like retiring old vehicles, how
23 retrofits of some of them have no durability are applied,
24 and things like that. I think that what's happening is
25 the debate is focusing on traps when that's only 12
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1 percent of the vehicles that we have to deal with.
2 BOARD MEMBER D'ADAMO: But that wouldn't be the
3 case -- I know we haven't had this testimony on this yet.
4 But if we provide for acceleration, would that be expand
5 that number?
6 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: No,
7 because it's the older vehicles.
8 EXECUTIVE OFFICER WITHERSPOON: It would
9 accelerate the pace at which old vehicles were scrapped,
10 but it wouldn't change the implementation or penetration
11 of traps.
12 BOARD MEMBER D'ADAMO: I must have misunderstood.
13 I thought that you'd have to utilize a trap along with an
14 engine or a vehicle that's -- a current vehicle in use,
15 wouldn't there be a combination, use both?
16 EXECUTIVE OFFICER WITHERSPOON: For every age
17 group, you have to use BACT, whatever BACT is. There
18 aren't any certified traps for the old engines. So it
19 just doesn't come up.
20 As they buy newer engines, then the engine that's
21 part of the model year grouping is required to have traps
22 when they're certified for those engine families. So then
23 they get on a new compliance schedule.
24 But as Mr. Cross indicated, we're not seeing any
25 failures. We arranged a site visit for waste industry
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1 representatives down to L.A. sanitation district, and they
2 came away much reassured and impressed by what was going
3 on. They had issues on everything from maintenance, to
4 the reaction of the mechanics, to the warranty and other
5 things we've been talking about. I think that allayed
6 their concerns enormously about the segment of the fleet
7 that might end up with traps.
8 BOARD MEMBER CALHOUN: Are we talking about
9 possible damage to the trap itself or to the --
10 MS. WILLIAMS: To the engine. The BACT pressure
11 ruins the engine. The liability falls on the end user
12 because once you modify the engine, you own it. There's
13 no engine manufacturer that will warranty it. And the
14 trap manufacturer is going to say, "No, you did
15 something." You've left us in a place where we have no --
16 it's a lemon law, is the only way we'll be able to save
17 ourselves.
18 I would ask before you move forward, that you sit
19 down with some of my members -- their Board meeting is on
20 this issue, the warranty and the liability issue for us in
21 November. And I'd like to clarify when the Air Resources
22 Board and our Board -- before we move forward on whatever
23 it is we end up doing -- that, one, we're not liable for
24 new trucks when we put traps on; two, we're not liable if
25 the trap has a BACT pressure issue and has a catastrophic
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1 failure.
2 And there's a misunderstanding here about how
3 poorly the vehicles did in the testing. The data that we
4 got shown from -- the Air Resources Board showed a number
5 of vehicles had failures. So they've just risen the
6 temperature level and said, "We're only going to do it to
7 these vehicles, and you can do this down here." We are
8 not engine manufacturers. We are truckers. My
9 maintenance guys have eighth- and ninth-grade educations,
10 and you're asking these people to decide what kind of
11 manufacturer equipment goes on vehicles. It's just
12 severely wrong.
13 EXECUTIVE OFFICER WITHERSPOON: We are not, in
14 fact, asking them to decide. We are issuing lists of
15 exactly what devices have been verified for exactly which
16 kind of engine and which model years. So it's simply a
17 look-up matter, that this device is certified by the Air
18 Resources Board is appropriate to their engine and is
19 available in the market to them.
20 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: The
21 failures were not on certified applications. In other
22 words, what we were doing was looking at the extremes to
23 find out where they do fail, which is something that one
24 would want to do in any program like this, find out where
25 they do fail so when you do set the limits, you set the
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1 right ones. So I think -- Stephanie wasn't at the L.A.
2 sanitation district. I was a skeptical too, to be honest
3 with you. It was a really, really impressive show. But
4 with respect to warranty, just really quickly, if the trap
5 hurts the engine, it's on the trap manufacturers.
6 MS. WILLIAMS: Could you put it in the rule?
7 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: It
8 is in the rule.
9 MS. WILLIAMS: It doesn't specify.
10 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Take
11 a look at the latest verification amendments. It is.
12 MS. WILLIAMS: The 15-day rule?
13 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
14 HEBERT: The verification procedure regulation itself
15 states there that if the retrofit device damages the
16 engine, the retrofit manufacturers are responsible for
17 repair.
18 MS. WILLIAMS: As a caveat, about certain
19 maintenance practices, which are not defined, it's an out
20 for the verification.
21 CHAIRPERSON LLOYD: Clearly we have to get that
22 resolved. What I would like to do is to follow up with
23 that issue. We need to expand upon, maybe report back to
24 the Board. But the other thing, we have the Diesel
25 Retrofit Advisory Committee coming up. I think it's
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1 October 14th.
2 EXECUTIVE OFFICER WITHERSPOON: That's correct.
3 And the Board will be revisiting the verification
4 procedures as they relate to --
5 CHAIRPERSON LLOYD: I think that's an
6 opportunity. And hopefully staff will invite some of the
7 members. Because clearly I think we need to be able to
8 close the gap -- the information gap and the trust gap
9 between the members and what we're doing with staff. So
10 we'll definitely work with you on participating --
11 MS. WILLIAMS: I think the most important thing
12 we can do is get the statute language decided before
13 somebody moves in a direction that's not good for either
14 of us.
15 Thank you.
16 CHAIRPERSON LLOYD: Thank you.
17 Tim Ward, Kelly Aster, Bill Dobert.
18 I would say, by the way, to Board members, we do
19 have a meeting of that International Diesel Retrofit
20 Committee. It's meeting in Pasadena. I think it's
21 October 17th.
22 Maybe after this we'll take a five-minute break
23 to allow the court reporter to take a break. And
24 hopefully we're going to try to get through this item
25 before we take our lunch break. Thank you.
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1 MR. WARD: Good morning. I'm Tim Ward, Tom Ward,
2 Incorporated. I'm a fuel distributorship in --
3 CHAIRPERSON LLOYD: Can you bring the microphone
4 closer to you?
5 MR. WARD: I have fuel distributor in Fireball.
6 I'm also representing California Independent Oil Marketers
7 today. Also I'm here to say I'm representing Terry
8 Perkins with Fireball Disposal.
9 Terry's business and I are very similar. We have
10 five trucks, all of them are '87 and older. The economics
11 of our businesses are basically the same. This is going
12 to be an expensive endeavor for us, putting these traps on
13 our trucks. We can't afford to buy new ones.
14 So we're asking for more time for the '87 and
15 more. We only have five trucks apiece. For example, I
16 made $18,000 two years ago, and 30,000 last year. But
17 because of workman's comp, increased insurance, they're
18 going to take 25,000 of my profit away from me this year.
19 So we're asking for more time. And I think more time also
20 gives us an opportunity to lessen the expense on the
21 device that they developed for NOx reduction. If you give
22 us smaller guys a little more time, we might have to only
23 put on one machine that will take care of the NOx problems
24 too. So that's what I'm asking.
25 CHAIRPERSON LLOYD: Thank you.
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1 Ms. Witherspoon.
2 EXECUTIVE OFFICER WITHERSPOON: I just want to
3 clarify, Mr. Ward is not affected by this regulation.
4 He's concerned about the precedent it sets for future
5 regulations and whether or not we would use the same
6 timetable for '87 and older vehicles -- is that correct?
7 MR. WARD: No. Actually, I'm -- we have our own
8 issue with ARB coming up in December. I'm representing
9 Fireball Disposal at that particular time.
10 CHAIRPERSON LLOYD: Thank you.
11 So as I mentioned, let's take a five-minute break
12 for the court reporter, and then we'll come back. And
13 then after that we will continue the item until we finish
14 it and then take a lunch break.
15 (Thereupon a recess was taken.)
16 CHAIRPERSON LLOYD: We're recommencing with Kelly
17 Astor, Bill Dobert, and Greg Sanders.
18 What I would ask, I know there's a lot of people
19 here all opposing in a row. If they've got similar
20 testimony as the person before, please try to conserve
21 some time so we can get through this item in a reasonable
22 time. I don't know where that starts. Thanks.
23 MR. ASTOR: Thank you, Mr. Chairman. Kelly Astor
24 on behalf of the California Refuse Removal Council. It's
25 been my privilege to serve the CRC for some 20 years as
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1 general counsel. In addition to doing that, I'm a solid
2 waste franchise attorney.
3 I'm interested in particular in the cost issues
4 related to compliance with the rule. There was a graphic
5 presented during staff's presentation suggesting that some
6 87 percent of municipal contracts allow for rate increases
7 for changes in the law. That number is basically
8 consistent with my general understanding. But the
9 significance of that I think is sometimes overstated.
10 The fact that the contracts may allow for
11 compensation to be recovered is the starting point, not
12 the end point. I'm here to tell you as one who has
13 negotiated literally dozens of these such contracts, very
14 often you don't get all that you ask for. So the
15 compensation issue is one that has been paramount in at
16 least my mind throughout the couple of years we've had an
17 opportunity to work with your staff.
18 And of those ten workshops -- or four workshops
19 and ten meeting that staff alluded to I've been grateful
20 to be present at most of them. Staff has gone as far as
21 it's able in one sense, but the recent set of amendments
22 which essentially take the municipalities out of the rule
23 are troublesome to the industry that I represent. Again,
24 we're a regulated industry. In the main, these contracts,
25 particularly in the residential context, are exclusive
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1 contracts. There is no competition. In exchange for
2 operating without competition, the cities have reserved
3 themselves, as naturally they should, with a right to set
4 our rates.
5 So we get what I call begging rights. We get the
6 right to go talk about what the costs of this rule are
7 going to be, but that isn't the end. That's why I'm
8 particularly pleased with staff's indication just in the
9 last day or so that they're willing to do two things to
10 improve the rule. While we still remain opposed to the
11 rule, these are important changes. One, it's vital to us
12 there's a look back or review undertaken by your Board
13 annually so you can find out, in fact, are the haulers
14 getting paid, or are cities giving only part of what they
15 need to ensure compliance.
16 In addition to that, it's important to us that
17 the intent language that we originally asked for be
18 restored to the rule. Now the intent language we're
19 asking for is not precisely the same of that which is set
20 forth in the September 25th staff proposed changes
21 handout. This talks about language expressing the intent
22 of the Board that collection -- contractors can negotiate
23 with their cities regarding the recovery of costs. That's
24 already in franchise agreements.
25 I'd like it to go a little stronger, similar in
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1 form to the language that we represented several months
2 ago, which basically expresses the intent the staff told
3 us two years ago when these negotiations started. That
4 is, it's not this Board's intent these costs be borne by
5 the service provider, rather the recipient ultimately is
6 the one that should bear these costs. If that issue is
7 taken care of, the only other remaining issue that we have
8 in general terms with the rule are the technical issues.
9 I'm not the one really qualified to speak to
10 those, but I will tell you this. This industry is, after
11 all, an environmental industry. Our commitment to air
12 quality has been unwavering. From the outset of our
13 negotiations with your staff, we've made clear the fact we
14 embrace our obligation to help with containing the air
15 quality objectives of this rule. We've also said we
16 support the adoption of a rule. It's never been an issue
17 that we don't support the adoption rule. It's always been
18 about what form should that rule take. I think it's
19 important we be credited with that.
20 Again, others will talk about some of the
21 technical issues that arise that haven't been fully
22 satisfied. And it's largely for those reasons and to some
23 degree the compensation issues we remain opposed to the
24 rule. But I will say that the staff has gone to great
25 efforts to accommodate us. We're looking for further
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1 accommodation. I'm open to any questions you may have.
2 CHAIRPERSON LLOYD: Thank you.
3 Ms. D'Adamo.
4 BOARD MEMBER D'ADAMO: I realize that staff --
5 and appreciate that staff was trying to achieve some sort
6 of balance here in putting forth the most recent intent
7 language. I'm not sure if the language that you propose
8 would upset a balance on the other side regarding the
9 municipalities.
10 What I'd like to see is perhaps some language in
11 the regulation that commits our staff to work with the
12 waste haulers and the municipalities regarding this issue
13 and the incremental cost.
14 MR. ASTOR: I think that's helpful. The one
15 thing I would suggest, when we go to talk to the city
16 attorneys, city manager, and their whole contract
17 negotiating staff, it would be very helpful -- we hold
18 very few of the cards. We're not complaining. We're
19 delighted with the current system. But the fact of the
20 matter is most of the leverage is with the cities we work
21 for.
22 If we had something expressed by this Board --
23 ideally in the language of the rule itself as opposed to
24 the resolution that said, "A funding source needs to be
25 identified, and it is not the intent of this Board that
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1 these costs be borne by the service provider." That would
2 go a long way towards alleviating our concerns. Because
3 if it doesn't say that, if we don't get the increases,
4 there are competitive impacts to this rule which have
5 never been fully articulated or analyzed.
6 BOARD MEMBER D'ADAMO: What I'm looking for is
7 some future commitment by this Board not to get involved
8 in individual contracts, but to be working globally toward
9 this issue of incremental cost.
10 EXECUTIVE OFFICER WITHERSPOON: During the course
11 of development, we did express our commitment to helping
12 the waste companies explain the rule they were under to
13 local governments, the expectations of the state. And you
14 heard in the staff presentation, we're going to continue
15 to do outreach. You also heard Yvonne Hunter say she's
16 going to help us hit all the communication networks so
17 that is understood by all the parties.
18 You also indicated there's a delicate balance
19 here. There is. We offered to restore intent language
20 that we had previously. We ran that by all the local
21 governments that came and testified previously. They're
22 okay with our version of the language. I think they might
23 be troubled -- I certainly can't be sure that they would
24 be all right with the sort of amplified version that's
25 being recommended.
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1 And one thing that we want to take care to avoid
2 is we can't guarantee the outcome here. But certainly our
3 own analysis, our calculations of cost, telling you what
4 it is per household, that's how we expect it to play out.
5 And it won't be perfect in every instance, but we wouldn't
6 want you to say the rule's conditioned on full cost
7 recovery exactly the way the waste industry interprets it
8 for their company, their contract. It's more directional
9 from the Board, that's the general intent in the rule.
10 BOARD MEMBER D'ADAMO: I'm not looking for the
11 rule to be conditioned upon. I don't think the witness is
12 either. I'm just looking for a little bit more than what
13 we have. And also the municipalities that testified today
14 spoke to the issue of liability. They didn't necessarily
15 speak to this issue. I'm just wondering since the
16 liability issue as the main stated concern here, perhaps
17 we can go a little bit further.
18 EXECUTIVE OFFICER WITHERSPOON: They did talk to
19 us privately about the other issue, about the cost, how
20 the negotiations go, the kinds of information they wish to
21 have, and back and forth. It will be a negotiation. But
22 they are willing to step up. They understand why we're
23 doing the rule. They didn't tell us, "Forget about it.
24 There's no way the cities and counties will pass these
25 costs onto the consumers, their rate reverses." We
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1 weren't getting that message from local government. And
2 we're beginning to keep working with them to see it
3 through.
4 BOARD MEMBER D'ADAMO: I'm just wondering if we
5 can go a little further on the intent language.
6 EXECUTIVE OFFICER WITHERSPOON: I'd be reluctant
7 to do that since the removal of the local governments'
8 opposition was contingent on all the things we talked
9 about, the specific language we showed them on intent of
10 putting that back. We would almost need to go track them
11 all down somewhere in the building. And a lot of them are
12 still here.
13 BOARD MEMBER D'ADAMO: At a minimum I think we
14 need to commit this Board and the staff -- I think we can
15 go with stronger language on what we can do, as you say,
16 with outreach and working with local governments.
17 EXECUTIVE OFFICER WITHERSPOON: That we can do.
18 And maybe during the lunch break --
19 CHAIRPERSON LLOYD: Can you help us here identify
20 specifically where we can locate the language in the
21 material we have?
22 EXECUTIVE OFFICER WITHERSPOON: It's in the
23 15-day package. Can you see what staff is holding up? A
24 single page. It should be there.
25 CHAIRPERSON LLOYD: Okay. Single page.
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1 BOARD MEMBER HUGH FRIEDMAN: If it's only a
2 sentence or two on intent, could you read it, please.
3 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF
4 HEBERT: It's more of a summary of what we did. And we
5 added a statement to the scope and applicability section
6 of the rule that "an intent making it clear that the Board
7 expects that municipalities and solid waste collection
8 vehicle contractors will negotiate regarding recovery of
9 costs incurred to implement this regulation."
10 GENERAL COUNSEL WALSH: The Board Clerk has just
11 pointed out to me that actually that is attached to the --
12 BOARD MEMBER HUGH FRIEDMAN: We can't hear you.
13 GENERAL COUNSEL WALSH: It's attached to the
14 yellow-faced package. That would be proposed Resolution
15 03-7-3.
16 BOARD MEMBER RIORDAN: It's at the back of the
17 packet.
18 MR. ASTOR: Members, to give you a contrast,
19 here's the language we would like to see. "It is the
20 Board's intent that municipalities demonstrate a funding
21 source to ensure compliance with Section 2023 and that
22 rate regulated fleet operators are fully compensated for
23 the actual and necessary retrofit fuel maintenance and
24 recordkeeping costs." It's still just an expression of
25 intent, but it goes beyond saying we should talk about it
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1 because, again as I pointed out, our franchise agreements
2 already give us the right to talk about it, but there's no
3 expression of the direction we'd like to see the cities
4 go.
5 BOARD MEMBER RIORDAN: Mr. Chairman, I think it's
6 sometimes difficult to work this language out at the last
7 minute. I can see how one could interpret the suggestion
8 in a way that might create an imbalance, which I'm not
9 sure we want to create this imbalance. We want to keep
10 everything on a point where we're asking the cities to
11 accept an opportunity to look at this and to find some way
12 to compensate. But I have some trouble with your words
13 just clearly as you read them just to me in the last few
14 minutes, and I'm hoping maybe the cities can perhaps offer
15 some comments.
16 CHAIRPERSON LLOYD: I guess we're asking for
17 Ms. Hunter. I know Supervisor DeSaulnier also had a
18 request to speak.
19 SUPERVISOR DeSAULNIER: I know how meetings run
20 in Sacramento, especially having watched the one last
21 night, so I'm just sitting quietly to get my opportunity,
22 Chairman Schwarzenegger.
23 MS. HUNTER: Mr. Chairman, members, Yvonne Hunter
24 with the League of Cities. Again, thank you for the
25 opportunity to comment. Kelly Astor and I and the waste
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1 industry, we've all gone around in circles on this issue,
2 and we're sympathetic to their concerns. It's the first
3 time I've actually heard in a long time the language that
4 Kelly read, and we simply couldn't go there. It would tip
5 the delicate balance that Catherine had talked about.
6 What would be very helpful to local governments
7 would be for the ARB staff -- and we've talked to the
8 staff about this -- to provide information to both
9 haulers, but more importantly to local governments on the
10 actual costs of some of these technologies. So that when
11 the haulers come to the local governments for discussions,
12 we have some reference point. We can say, "Yeah, you're
13 right. That is the cost," or, "No, I'm sorry. You know,
14 we don't know."
15 We look at them as our partners in providing
16 service. But I think that would be very, very helpful.
17 And we pledge to work with the industry and work with the
18 Air Board to make this work within the framework of
19 conditions and terms and franchises and contracts.
20 CHAIRPERSON LLOYD: Thank you.
21 BOARD MEMBER D'ADAMO: I'm comfortable with that.
22 I just think that the intent language needs to say that,
23 to include our role.
24 EXECUTIVE OFFICER WITHERSPOON: We'd be happy to
25 do that.
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1 CHAIRMAN LLOYD: Supervisor DeSaulnier.
2 SUPERVISOR DeSAULNIER: Perhaps it's all been
3 said, but I agree with D.D. Having been in local
4 government for well over a decade and having been involved
5 in my fair share of franchise agreements -- and I don't
6 know how many we have in our county, but it's multiples.
7 I don't see how we can fix this, I mean, the franchises
8 get audited, at least in my experience -- I don't know
9 about other people in local government -- as to what
10 they're spending. Their pass through should be a
11 reasonable pass through that we can tie to what the actual
12 costs are. I don't think -- that's not something that we
13 can not -- we're unable to do, I should say. So it may be
14 just a question of semantics but if we can work on --
15 and I know you've worked on it forever. But between now
16 and the end of the hearing, I don't see how we couldn't
17 come to some conclusion that would be reasonable for
18 everyone so --
19 CHAIRPERSON LLOYD: So what you're saying, some
20 cost recovery, but that's got to be the true cost?
21 SUPERVISOR DeSAULNIER: Right. Over the period
22 of time we're doing this, they -- and I know every
23 franchise isn't the same -- but those that do have audit
24 requirements should be able to go back and look at those,
25 the true costs, the actual cost.
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1 CHAIRPERSON LLOYD: Yeah.
2 SUPERVISOR DeSAULNIER: Thank you.
3 CHAIRPERSON LLOYD: Quit when you're ahead.
4 Thanks. No. If you need to come back later -- but I
5 think we have --
6 MS. HUNTER: I just want to make sure we don't
7 tip the balance too far where we're no longer in support.
8 CHAIRPERSON LLOYD: I don't think so.
9 SUPERVISOR PATRICK: If I might make a comment.
10 I know we're ready to move on. I have to agree with this
11 woman from the League of Cities.
12 I think that we should have no role whatsoever in
13 the negotiations between the local governments and the
14 franchise folks. If you want to strengthen language or
15 something that said, you know, it's our intent that they
16 be compensated for this through the pass through that goes
17 to the taxpayer, I think that's okay, although I don't
18 have any objection to the language that we have in there
19 now. But I think we need to be very, very careful about
20 going too far in saying that it's simply the haulers who
21 are going to tell the local government how much this is
22 going to cost because that is certainly not acceptable.
23 And so, you know, I think that the language that was
24 presented by the Refuse Removal Council goes way beyond
25 what I would be willing to accept.
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1 CHAIRPERSON LLOYD: I thought what we were
2 looking at here was trying to use a technical resource --
3 economic resource; is that right?
4 SUPERVISOR PATRICK: Absolutely. And to be able
5 to have information about what the true and actual costs
6 of this, I think is -- that's the role that we would play.
7 But certainly not getting any further into any
8 negotiations process in that.
9 EXECUTIVE OFFICER WITHERSPOON: As I understand
10 the Board's direction, it is to keep the intent language
11 the way the staff proposed it, but to add to it the
12 explicit role of the Air Resources Board staff in
13 communicating the local governments what we believe the
14 cost of compliance with the regulation to be; is that
15 correct?
16 CHAIRPERSON LLOYD: Two of my colleagues on the
17 right, is that okay?
18 EXECUTIVE OFFICER WITHERSPOON: I'll repeat.
19 SUPERVISOR DeSAULNIER: We were talking about --
20 what was the word we used earlier? Recalcitrant local
21 government?
22 CHAIRPERSON LLOYD: But I think the key issue
23 here is that you raised some issues. And Barbara wants to
24 make sure we didn't go too far, and that is what I think
25 Ms. Witherspoon was saying, that we modify the language to
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1 indicate that the Air Resources Board will provide
2 information to the local municipalities so in fact there
3 would be evidence that the costs are really what they
4 cost. I think that sounds good.
5 SUPERVISOR DeSAULNIER: I think that's fine. But
6 at some point there are actual costs they will be able to
7 demonstrate physically in terms of bills and products they
8 buy that will be passed through. It's not rocket science.
9 EXECUTIVE OFFICER WITHERSPOON: What the
10 distinction is, is what is the cost attributable to the
11 regulation versus the cost tied to company choice or other
12 reasons like buying more new trucks than the reg would
13 compel them to do. That's where the dividing line is
14 going to be.
15 SUPERVISOR DeSAULNIER: I understand.
16 CHAIRPERSON LLOYD: Thank you.
17 We have Bill Dobert, Greg Sanders, Jack Fiori.
18 MR. DOBERT: Good afternoon. Just change over
19 here. I'm Bill Dobert. I'm the current Northern District
20 President of the Californian Refuse Removal Council. I'm
21 also the CFO of Speciality Solid Waste in Sunnyvale. For
22 a family business we're a jack-of-all-trades. I'm also --
23 even though I've got all this white hair -- the youngster
24 in this industry. I've only been in this thing for about
25 12 years, having previously been a banker.
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1 The company, Specialty, I work for has been
2 around for 50 years. I guess what I'm here to talk about
3 is essentially what Kelly talked about, what you've been
4 discussing, and that's the compensation issue. When I got
5 into this business, franchise agreements were 20 pages, 30
6 pages, 40 pages. And over the years the cities have
7 decided to hire consultants to do the work for them and
8 make the decisions, and the franchise agreements are now
9 150 pages long.
10 I heard a number that 87 percent of the franchise
11 agreements have a provision in there allowing for -- and
12 somehow I guess it was synonymous with guaranteeing that
13 any regulatory change we would get compensated for. Well,
14 some of you have been involved at the counsel level. You
15 know the result. Some of the discussions are smooth.
16 Some of them aren't. It's not as easy to say there's
17 three words in a franchise agreement that says if you go
18 out and spend, what we don't know is what's going to be
19 the cost at this point. If it's going to be millions and
20 millions of dollars or if it's going to be something less.
21 We're going to be able to show invoices, which we will, to
22 substantiate what we have paid for, and they're going to
23 say, "We'll just build it into your payment next month."
24 CHAIRPERSON LLOYD: How large is your company, by
25 the way?
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1 MR. DOBERT: Our company is about 45 to 50
2 trucks. Pretty much representative of most of the folks
3 that raised their hand in the group back here.
4 The problem is it's just not that easy any more.
5 And so that's why it's critical to us that we guarantee --
6 and once again, I've heard that from Yvonne there's no
7 indication from the cities that they don't want to say,
8 "If you spend the money, show us the invoices. As long as
9 it's within what the rules and regulations say you're
10 supposed to buy, that we will build it in and you will get
11 compensated." I don't think there's any indication that
12 anybody said they want to provide any company with
13 financial hardship because of this.
14 CHAIRPERSON LLOYD: So this is your major issue?
15 MR. DOBERT: This is our major issue. And the
16 only thing is we want you to know that in concept we
17 support clean air and providing whatever you want us to
18 do. We've done it with AB 939, and we will continue to do
19 that.
20 CHAIRPERSON LLOYD: Well, I think you've heard
21 the sentiment, and we're trying to work something out
22 here. So I hope you and the succeeding people who testify
23 bear that in mind, the fact we're trying to work that out,
24 and please try to limit your testimony.
25 MR. DOBERT: We appreciate that. And we hope it
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1 will be part of the final outcome of the next 15 days.
2 CHAIRPERSON LLOYD: Again, you heard that staff
3 is going to come back to see how this rule is working out,
4 and so you're not signing on for a lifetime here. We're
5 very sympathetic and concerned about how this plays out,
6 and we want to work with you on that.
7 MR. DOBERT: Thank you. I appreciate that.
8 CHAIRPERSON LLOYD: We have Greg Sanders, Jack
9 Fiori, and Andy Rose.
10 BOARD MEMBER D'ADAMO: Mr. Chairman, as the next
11 witness is approaching, I was also wondering if we could
12 ask the waste haulers if they could provide us with
13 information as to their fleet size when they come up here.
14 MR. SANDERS: Certainly.
15 CHAIRPERSON LLOYD: That's good.
16 MR. SANDERS: Honorable Chairman, members of the
17 Board, my name is Greg Sanders. I work for Varner
18 Brothers in Bakersfield. We have a fleet of approximately
19 45 trucks that we put out on the road every day and are
20 involved in environmental quality and environmental issues
21 every day. And we've been doing that in this community
22 and Bakersfield and Kern County for the last 63 years.
23 We attempt to be very actively involved in
24 statewide issues. When it became apparent this was going
25 to be an issue that was going to affect us and that we
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1 needed to work with CARB, we immediately came and became a
2 part of the negotiations and discussions with your staff
3 regarding this issue. We have been involved for the last
4 18 months. We have been involved as a company in regard
5 to testing equipment. We have tested diesel oxidation
6 catalysts. We have tested ultra low sulfur diesel long
7 before we were ever required because our contracts require
8 us every day to pick up refuse. We cannot not pick that
9 up. And if the technology does not work, we have to know
10 beforehand, before it threatens our contracts and what we
11 do.
12 I come before you today with a completely
13 different message than I intended 24 hours ago. And it's
14 a real world message. At 2:00 yesterday afternoon, I met
15 with an industry leader regarding our plans for the future
16 and essentially where we were going. He had been a part
17 of providing us, our company, with data logging and for
18 information that we would need that was critical to move
19 forward with our program. I was informed by one of the
20 top people in the industry that there are individuals --
21 that there are engineers had misread our data. And that
22 the data was now going to require us to go to a diesel
23 particulate filter, which essentially is three times the
24 cost of where we had intended on going and had been
25 planning on going for the last year.
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1 There is not only the cost associated with this
2 dramatic change that at a time that is very tough for us
3 as an industry, but there's also the infrastructure
4 because if we have to go to DPFs -- and I understand
5 staff's concern about the potential year of giving us
6 leeway to have ultra low sulfur diesel on site. But
7 realize if I have to go to a diesel particulate filter, I
8 have to have an entirely new above-ground tank for that
9 fuel, and I have to go through a series of different hoops
10 to get that fuel.
11 And I told you earlier we had been involved in
12 the testing. Our latest invoice showed we're paying 14
13 cents a gallon additional -- 14 cents for ultra low sulfur
14 diesel fuel. If it's not mandated as a part of this, that
15 cost is going to continue to remain high.
16 CHAIRPERSON LLOYD: Can you -- three minutes have
17 gone.
18 MR. SANDERS: Okay. Very quickly, we've got a
19 crisis of confidence, and part of the problem simply rests
20 with the fact that we don't believe that there is a broad
21 enough technology base out there to support all of the
22 issues that need to be addressed. And there aren't enough
23 people in the industry or around this country to move this
24 rule forward as it's currently written.
25 And the cost -- and just to summarize, this was a
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1 real issue. This was a huge issue for us. I had to make
2 a call yesterday to my owner to tell him that my estimates
3 for our program had gone from tens of thousands of dollars
4 to hundreds of thousands of dollars. That's a real world
5 happening. That's what happened to me yesterday. Not a
6 very pleasant day. So understand that these technology
7 issues are real, that for us they have to be addressed
8 before we can move forward. And we feel it's critical
9 that they be dealt with.
10 We have attempted to be proactive. We've
11 attempted to work with staff and do the things in advance.
12 We will continue to do that.
13 CHAIRPERSON LLOYD: Thank you very much. I think
14 we will have people testifying on these devices later on.
15 Thank you.
16 Jack Fiori, Andy Rose, Mark Figone. Again,
17 Ms. D'Adamo -- how many trucks do you have?
18 MR. FIORI: Sorry. We have 18 trucks.
19 CHAIRPERSON LLOYD: 18.
20 MR. FIORI: My name is Jack Fiori. I'm the Vice
21 President of California Waste Recovery Systems. Our
22 business office is located in Lodi, and we provide
23 residential and commercial solid waste and recycling
24 services to San Joaquin and Sacramento counties. We're a
25 privately owned business owned by the Vaccarezza family
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1 for more than 75 years. We implemented the first three
2 carts back in San Joaquin and Lodi back in 1993 and first
3 two-cart residential collection systems in Sacramento
4 County, one in Galt and the other in what is now Elk
5 Grove.
6 As has been said, like most small garbage
7 companies, we've been recycling and diverting reusable
8 materials from the waste stream since our inception. Like
9 most small garbage companies, we're used to helping
10 communities do the right thing and be part of a solution
11 when it comes to the protection and preservation of the
12 environment. We support the air quality objectives of the
13 control measure as proposed. And we are not in
14 disagreement with the implementation time line if the
15 technology is proven, if it's on the shelf, and if it's
16 available to help us get there.
17 Beyond that, and using your own numbers, nearly
18 90 percent of the solid waste recycling collection in
19 California has been performed through the municipal
20 contracts we've been discussing. Many of these agreements
21 have fixed rates and do not include provisions to allow us
22 to recover for expenditures. Speaking personally, we have
23 two franchises with exclusive contracts. One is pretty
24 clean. One is nowhere close to clean language. I expect
25 some challenges. I expect some difficulties with that.
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1 And as business people, I think we both agree
2 that many times the word "negotiate" is a synonym for the
3 word "compromise." And to use the staff's numbers from
4 before, if I understood them correctly, in round numbers,
5 staff suggests that a dollar a year will be the cost per
6 household on this. And to carry that a step further, the
7 typical household pays about $200 a year for solid waste
8 service using the number 16, $17 per house, per month, and
9 rounding off. So a dollar of $200 is half a percent.
10 Well, those of us that have to go in and we've
11 got fixed rate changes or fixed rate adjustments based on
12 CPI, we're only going to get 2 1/2, 3 1/2, 4 percent. So
13 now we're going to dedicate a half a percent of the 3
14 percent, is a significant piece. And over the long haul,
15 it's going to cause a company like ours to fall back in
16 the race. Because if CPI is what we need to stay level,
17 we're no longer going to get it.
18 In closing, I urge you to reconsider the proposed
19 rule. I ask you to include adequate provisions to allow
20 for time extensions if the proven equipment is not
21 available to meet the emission standards. I'd ask you to
22 provide a mechanism so the haulers can recover their costs
23 by complying with standards in the case where municipal
24 franchises otherwise prevent it.
25 CHAIRPERSON LLOYD: Thank you very much.
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1 Clearly, we are concerned about the small facilities as
2 well. So thank you very much.
3 Now we have Andy Rose and Mark Figone and Dennis
4 Shuler.
5 MR. ROSE: My name is Andy Rose. I come from a
6 slightly different perspective than my colleagues in the
7 hauling industry. I'm an attorney and financial advisor,
8 and I finance these companies. So when costs increase --
9 I'm actually speaking against interests. This is a good
10 thing for me. I actually urge you to raise the cost a lot
11 because I'll have to do more financing, and I'll make more
12 money. However, it doesn't really work if the haulers
13 can't afford to do it. Most of the haulers are going to
14 have to borrow money to do anything of any magnitude. I
15 want to basically reinforce -- let me finish that. I
16 represent about 65 haulers in California. Most of the
17 haulers -- a vast majority of any size of the group the
18 haulers that are speaking here. We're missing one, and we
19 intend to get him at some point. The rest are all
20 clients.
21 I want to ditto what Kelly said, but let me just
22 bring up a couple things. Supervisor DeSaulnier suggested
23 that some of the contracts do provide for cost of service
24 recovery. And that's very true. Unfortunately, they're
25 in a very big minority of contracts statewide. I also, as
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1 Kelly does, serve as a financial advisor, but I also
2 negotiate these contracts. When you have one of those
3 types of contracts, you're absolutely right, it's a good
4 thing because you can negotiate the present price of
5 service you're going to get back. The vast majority do
6 not have that.
7 The '87 percent you guys sought, a lot of those
8 literally say you can come to the Council and ask. And
9 Kelly describes it properly as the begging rights. There
10 are Councils that say no. There are also agreements --
11 and some of the consultants were referred to earlier --
12 that actually don't want to put any extraordinary increase
13 provisions, period, in those contracts. In other words,
14 you may not come back. We don't care what happens to you.
15 Another trend is most of the contracts -- I would
16 say probably the majority go up by inflation. The latest
17 trend with the consultants is not to give you all the
18 inflation. They give you 50 percent of the inflation or
19 something like that.
20 So I want to make it very clear that while I
21 understand the intent -- and everyone is agreeing here
22 that the intent is wonderful. And everyone here says,
23 "Yes, we should do this. The cities should do this."
24 When you get down to the ground as a practical matter, I
25 would predict a great number of haulers are going to have
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1 a very difficult time getting anything from their cities.
2 Finally, let me give you one specific example.
3 Workman's comp and fuel have gone up precipitously, as you
4 know, during the period of the last year. One of my
5 haulers who I think had 13 or 14 franchises went and asked
6 under the provisions that were in those contracts for
7 increases, based on those greatly increased cos,ts 400 or
8 500 percent for workman's comp. Two out of their 13
9 agreed to do that.
10 Finally, borrowing money, we have to go to banks.
11 There are two issues here. One is technology and one is
12 cost recovery. We've talked about cost recovery. You're
13 going to hear more about that. I don't know much about
14 the technology. All I can say is it's very important that
15 when we go to a bank to borrow money for something like
16 this that we can truly say to the bank, "Yes, this
17 technology works. And yes, we'd like to amortize these
18 trucks over seven to ten years, and they actually will
19 last that long, and our operation and maintenance costs
20 are reasonable." If we can not prove that, the hauler is
21 going to have a hard time borrowing the money, which means
22 they're going to have a hard time complying.
23 CHAIRPERSON LLOYD: Thank you very much. Thank
24 you.
25 Mark Figone, Dennis Shuler, and Sheila Edwards.
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1 MR. FIGONE: Good afternoon. My name is Mark
2 Figone, and I'm the General Manager of East Bay Sanitary,
3 and we have the exclusive contract for the city of El
4 Cerrito. We have currently only 11 diesel units, however,
5 we are in ongoing discussions with the city in an attempt
6 to acquire the recycling collection. So I would like to
7 speak optimistically and say we have 15 truck haulers, and
8 I would like to speak as such.
9 CHAIRPERSON LLOYD: Okay.
10 MR. FIGONE: We have just 15 employees. And in
11 consolidation in our industry over the past few years,
12 we've remained one of the few independent small haulers in
13 the county. My grandfather acquired the franchise in
14 1940. And since that time, we've been very successful in
15 maintaining relationships with successive council members,
16 staff, and with citizens of El Cerrito as well.
17 I came to work full time for the company in 1986.
18 I represent the third generation of our family managing
19 the business, and I'm proud of the business we've built,
20 and I hope to continue with it for many, many years to
21 come.
22 El Cerrito, as you know, is a vanguard on
23 environmental consciousness. They began the separation
24 and collection of recyclable materials back in the 1970s,
25 long before the advent of AB 939. As I just mentioned,
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1 they continued the collection, but we support them and
2 have throughout the years in terms of doing some of their
3 hauling of materials they collect. We also provide
4 billing services and help distribution of some of their
5 outreach and public education materials.
6 I mention this to emphasize the fact that both
7 East Bay Sanitary and the city of El Cerrito have a long
8 history of concern for the environment. We share the same
9 concerns as this Board and the state -- the citizens of
10 the state for clean air and other environmental friendly
11 business practices.
12 I'm here today to express my concerns, however,
13 that this proposed rule as written represents a
14 significant risk to the ongoing success of my family
15 business. El Cerrito is a very hilly community. We're
16 hard on our equipment. Just not to be redundant, but we
17 want to echo the representative from CTA's concerns about
18 the technology uncertainties. And we see a scenario where
19 as they unfold, it will create an excessive burden -- cost
20 burden for our business.
21 As has been mentioned also, we just completed a
22 two-year rate review process with our city. We have a
23 rate model on board. The rate model did not anticipate
24 the kinds of costs this new rule could potentially create.
25 And we have the option to renegotiate, but also as has
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1 been mentioned, renegotiation is not a guarantee that we
2 will be able to recover these initial costs.
3 Rather than being terribly redundant, I'd just
4 like to close and say that, again, as currently written,
5 this rule places us at a competitive disadvantage, given
6 our size and given the fact that we have much larger, more
7 well funded public companies that surround us. They have
8 a much quicker ability to come in and respond to these
9 kinds of cost increases without having to go directly to
10 the rate payers. So without some or protection for
11 funding, it puts us at risk. Thank you.
12 CHAIRPERSON LLOYD: Thank you very much.
13 BOARD MEMBER RIORDAN: Mr. Chairman, I just have
14 one quick question. You just negotiated the contract.
15 How long is that contract now? What is the --
16 MR. FIGONE: Our current contract is 12 more --
17 12 more years.
18 BOARD MEMBER RIORDAN: And does it --
19 MR. FIGONE: The rate model is negotiated
20 separately. The contract was already in place.
21 BOARD MEMBER RIORDAN: The contract is in place.
22 Then when do you renegotiate a rate increase?
23 MR. FIGONE: We would -- the rate model allows us
24 or the city to come at any time, given any significant
25 change in our cost of operations or under the city's
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1 suspicion that things have changed.
2 BOARD MEMBER RIORDAN: Thank you.
3 CHAIRPERSON LLOYD: Thank you very much.
4 Dennis shuler, Sheila Edwards, Kevin Mullins.
5 MR. SHULER: Good afternoon. My notes originally
6 said good morning. I'm Dennis Shuler. I'm the
7 Environmental Affairs Manager for Gilton Solid Waste
8 Management. Our company currently operates about 50
9 trucks. This is a family-run organization. Currently,
10 the third generation in this family is running it. I've
11 personally been involved with the company for about eight
12 years. I've been in environmental work here for 29 years
13 in California.
14 The first thing we want to say from our company,
15 we are totally 100 percent in favor of what the Board is
16 doing in terms of establishing standards and helping with
17 emissions related to diesel engines. We have never
18 questioned that, and we are totally in support.
19 We live in the central valley where we have some
20 significant air emission problems. We know. We raise our
21 families there. We coach soccer teams. So this is to our
22 benefit. But as you've heard from other speakers here, we
23 as a refuse hauler in the valley do have problems with
24 this particular set of regulations. I'm not going to
25 speak on everything. I'm just going to speak on one
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1 issue.
2 Our company currently serves under contract ten
3 different jurisdictions; three counties and seven cities.
4 We have contracts with each one of those jurisdictions,
5 and every one of those contracts is different. But each
6 one of them has three things in common. First, they get
7 to set the rates. And that means a great deal in terms of
8 what we're able to do in terms of operating our business.
9 Secondly, we're mandated in every one of the contracts
10 that we have to meet all federal, state, and local
11 regulation's statutes. So that's a condition upon every
12 contract we have. And lastly, all of these contracts have
13 language in them regarding us coming to them -- and the
14 key word, asking for a rate review or asking for a rate
15 adjustment. Under none of these contracts are we
16 guaranteed that we will receive rate increases.
17 The key word I heard in your staff's comments was
18 they did the survey and they came back and asked the
19 question did they allow for rate adjustments. That
20 doesn't mean they occur. Just to be brief, I stand in
21 front of city councils and boards all the time. We
22 present our members with the full analysis for these folks
23 every single year. That doesn't mean that our costs are
24 going to be compensated. Many, many times our costs show
25 we need a 4 percent increase, and staff will recommend to
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1 their elected official maybe 2, 2 1/2 percent. So we're
2 facing this all the time.
3 I'll finish up quickly. I just wanted to again
4 reemphasize we're totally in support of CARB's goal to
5 reduce emissions. We just question whether or not this
6 set of regulations at this time is going to accomplish
7 what you want. Thank you very much.
8 CHAIRPERSON LLOYD: Thank you.
9 Sheila Edwards, Kevin Mullins, Louie Pellegrini.
10 I would ask the people testifying -- I realize
11 this is very important to you, otherwise you wouldn't be
12 here. But please try to identify what we can do. Because
13 the individual case studies, while we can hear that, we
14 cannot really address all those in the individual context.
15 The broad context we could. It would really help us in
16 the long run. Thank you.
17 MS. EDWARDS: Thank you, Chairman. I will be
18 brief. My name is Sheila Edwards. I work for Marine
19 Sanitary Service and Recycling Marin County. Excuse me.
20 I've been waiting so long I forgot my voice. I represent
21 the Garbino family who could not be here today. It's a
22 family business, and they are running the business and
23 working hard at. But they send their regards and their
24 support for this clean air process.
25 CHAIRPERSON LLOYD: How many trucks do they have?
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1 MS. EDWARDS: We operate approximately 100
2 trucks, source separated collection, so many trucks run
3 the same routes.
4 I will be brief with my statement. Our concerns
5 are, again, the cost assurances. It's going to come out
6 one way or the other. Right now we have been very proud
7 to have reached a 70 percent diversion rate in our county.
8 We operate the first recycling center on the west coast.
9 Now, granted, that is in excess of what the state mandate
10 is, but it would be a shame to lose something in our
11 recycling diversion in order to pay for costs to reach the
12 air pollution requirements.
13 The second is the technology, where we don't know
14 where we stand with that. Some of the equipment and the
15 machinery is not available yet. We don't know what will
16 happen when we apply that machinery to our existing
17 trucks. And again, there are no assurances as to what
18 will occur if the trucks go down and the machines blow up.
19 I won't repeat any more of what has been said
20 before. I thank you for your time. We are dedicated to
21 providing quality sanitation and recycling services to our
22 communities, maintaining our recycling diversion rate, and
23 cleaning up the air. We support your work here, and we
24 look forward to working with you to craft a rule that is
25 achievable for our community and meets the air quality
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1 objectives.
2 CHAIRPERSON LLOYD: Thank you very much.
3 Kevin Mullins, Louie Pellegrini, Sheryl
4 Granzella.
5 MR. MULLINS: Good afternoon, Mr. Chairman, Board
6 members. My name is Kevin Mullins. I'm from the Mill
7 Valley Refuse Service. I bring greetings the Bedio family
8 who could not be here today. They're busy servicing our
9 18,000 customers in the cities of Mill Valley, Corte
10 Madera, Tiburon, and Almonte.
11 My company has provided collection and recycling
12 services for these communities since 1906, almost 100
13 years. We operate about 40 trucks, and I'm here to
14 express the company's strong support for the clean air,
15 yet we are opposed to this proposal on a number of
16 grounds, which I'll briefly discuss now.
17 First and foremost, as a rule is written, this
18 could potentially bankrupt our company. This is a small
19 family-owned. This is their life savings at stake here.
20 I say this not only as a concerned citizen, but as an
21 accountant and an economist, and because I do their books.
22 Our company operates under contracts that do not
23 ensure increase on the rates being charged to offset the
24 tremendous financial burden this rule contemplates. For
25 example, last year with the massive increases of workers'
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1 compensation, a lot of our elected officials that we
2 service said, "Tough luck." We got half the increase that
3 we asked for.
4 Going forward, I want you guys to understand that
5 is a family's life savings that we're risking here on a
6 technology that's not exactly proven. And some of the
7 stuff in the staff report discusses that the impact is
8 not -- will be insignificant, and there's no potential
9 cost impact. If we're not allowed to pass this on, this
10 is the people's homes. This is the people's lives. This
11 is college fund we're talking about here. This is a small
12 family. We're worth about $10 million, but if we are to
13 revamp our entire fleet, it would cost about $4 million.
14 So leverage that, that's 40 percent of our equity. That's
15 a risk that the owners cannot afford to take.
16 Second, as a small business, we see that our
17 company will be crippled with the debt load if forced to
18 absorb the cost without recovery from the customers. The
19 national waste companies may be able to shift their old
20 trucks to areas out of state and bring new trucks in from
21 elsewhere subsidized by profits from their massive
22 corporate infrastructure.
23 The Bedio family is a business that is formed to
24 stay in business, and we do not have this luxury of being
25 able to shift costs or subsidize our expenses with sources
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1 from elsewhere. By weakening the company's strength, the
2 rule as written threatens to put them out of business. I
3 don't think this is what California wants. We are in the
4 business of environmental protection and fully support the
5 need for clean air. We have achieved a diversion rate
6 of -- I believe the current number is 74 percent. So we
7 take the environment very seriously. We cannot, however,
8 successfully implement or support the rule that does not
9 provide for mechanisms for us to recover our costs.
10 The most recent example that illustrates this or
11 points this out is the bankruptcy of the electric
12 utilities because if you control one side but not the
13 other, who gets stuck in the middle? It's the service
14 provider, which would be us. In short, we wind up
15 becoming debt laden and no longer economically viable.
16 This is a company that's been around -- survived the Great
17 Depression and is now in its third generation, just to be
18 put out by an environmental rule that can be done using a
19 multitude of different methodologies.
20 A solution, for example, is a model successfully
21 used under AB 939 to require the municipalities to comply
22 with public policies and objectives. The municipalities
23 who granted the authority to assess local fees for solid
24 waste management, not the private vehicle owner, are in
25 the position to ensure that the costs of compliance are
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1 ultimately borne by the rate payer. This isn't clear.
2 We've achieved 74 percent where I think much of the state
3 and the country is around 30 or 40 percent.
4 I thank the Board for considering my remarks, and
5 I'm available for any questions that you have.
6 CHAIRPERSON LLOYD: Thank you. Louie Pellegrini,
7 Sheryl Granzella, Ronald Proto.
8 MR. PELLEGRINI: Good afternoon, Mr. Chairman and
9 Board members. My name is Louie Pellegrini. I'm the Vice
10 President of Peninsula Sanitary Service, a family company
11 on Stanford University. We run 15 trucks --
12 CHAIRPERSON LLOYD: One-five?
13 MR. PELLEGRINI: One-five. We're also involved
14 with some other companies that we operate in San Mateo,
15 Santa Clara, and Alameda County.
16 On a daily basis, I'm responsible for 100 trucks
17 leaving the yard every morning. Believe me, that is not
18 an easy feat. My experience is third generation, 30 years
19 have been driving the trucks, repairing the trucks,
20 negotiating the contracts, negotiating the rates,
21 inspecting equipment, and it's not an easy -- our business
22 isn't simple anymore.
23 We have embraced alternative fuels. In the '70s,
24 our fleet were propane-fueled equipment. The technology
25 was there. The support wasn't there. It fumbled. In the
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1 early '90s we got involved with CNG conversion on our
2 service vehicles and our large collection vehicle. We had
3 to change the engine out. The technology is always
4 playing catchup. We are currently running 12 compressed
5 natural gas trucks in one of our franchise agreements.
6 It's working. My fear on the technology side and the age
7 and number of trucks that we have is that we're putting
8 the cart before the horse in that it's not proven.
9 In our franchise agreements in keeping our rates
10 down with the rate payers and the elected officials happy,
11 we have scheduled equipment replacements going out from
12 seven to ten years. Our franchises have life left of 11
13 to 20 years. This has all been scheduled to provide a
14 reasonable rate increase to recover costs and provide
15 efficient services to our customers.
16 We embraced AB 939. We met the rules of our
17 cities. We invested a lot of money. My concern with the
18 technology and the rule is there isn't any offramp if the
19 technology does not come to fruition like it's supposed to
20 here. My biggest fear is that I will not have the ability
21 to provide the service because equipment does not
22 function.
23 The trend in the new franchises is liquidated
24 damages, missed customers, inability to complete routes,
25 $150 a day fines if we can't complete the route. I feel
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1 between a rock and a hard spot basically sitting here
2 today that we're depending on manufacturers for traps,
3 engines, and the cities not wanting to step forward to
4 partnership, with technologies being borne here, a lot of
5 phrases that kind of tie it all together, but it's on our
6 backs. And my confidence level to be able to go forward
7 and get the job done, I feel we're at risk. And --
8 CHAIRPERSON LLOYD: I think you heard -- I think
9 your confidence issue is staff is going to work this
10 issue, monitor the issue. You heard the engine
11 manufacturers want to work here. We have some testimony
12 from some of the aftertreatment. And clearly we need to
13 work together. But we're not going to leave you in
14 isolation there.
15 MR. PELLEGRINI: I'll just finish up here. I'm
16 speaking from where the rubber meets the road. In the
17 last ten years, I rolled out five major fleet retooling
18 collection systems, interact with the chassis
19 manufacturers, the truck manufacturers, the engine
20 manufacturers. Murphy's law, it doesn't always go as it's
21 supposed to. A lot of promises, but we're going to set a
22 rule here that's going to effect us down the road.
23 CHAIRPERSON LLOYD: We have a checks and balances
24 here. We have staff reporting back. We obviously share
25 some of your concern that there will be enough faith to go
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1 ahead. Thank you very much.
2 MR. PELLEGRINI: Thank you.
3 CHAIRPERSON LLOYD: Sheryl Granzella, Ronald
4 Proto, Doug Button.
5 MS. GRANZELLA: My name is Sheryl Granzella, and
6 today I represent the Richmond Sanitary Service, which is
7 the subsidiary of Republic Services. Much of what I was
8 going to say today has already been said. I don't want to
9 be redundant and go on and on.
10 CHAIRPERSON LLOYD: Supervisor DeSaulnier will
11 appreciate that.
12 SUPERVISOR DeSAULNIER: I'm in charge of
13 redundancy.
14 MS. GRANZELLA: Richmond Sanitary Service has
15 provided waste collection, recycling services to western
16 Contra Costa County for more than 80 years. My father
17 served as President of Richmond Sanitary Services for 45
18 years until the company sold to Republic Services in 2001.
19 And I, like many of these people in the room, grew up in
20 this business.
21 CHAIRPERSON LLOYD: Did you say how many trucks
22 you had?
23 MS. GRANZELLA: I'm getting there.
24 CHAIRPERSON LLOYD: Sorry.
25 MS. GRANZELLA: Today we operate 70 trucks at
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1 Richmond Sanitary Service alone, but Republic Services has
2 well over hundreds of trucks in California. But Richmond
3 Sanitary Service has six exclusive franchises and six
4 municipalities. As you've already heard, all the terms in
5 these agreements are different. And every one of them are
6 different. And they don't all have the same thing.
7 We feel we perform an essential public service
8 for our customers. We're very concerned about the
9 environment. We strongly support the air quality that
10 CARB is seeking with its proposed rule. We really ask
11 that you help support all of us with our concern for our
12 capital and our operating cost that we in the industry
13 will need and we need to recover from our rate payers. So
14 I appreciate all that's been said today about how you're
15 going to change the language to work with us. Thank you
16 very much.
17 CHAIRPERSON LLOYD: Thank you very much indeed.
18 Ronald Proto, Doug Button, David Achiro.
19 Maybe if the speakers could line up in the front
20 so we can save a little bit of time. It all adds up here.
21 MR. PROTO: Good afternoon, Mr. Chairman, members
22 of the Board. I don't want to repeat what everybody has
23 already said, but I do want to punctuate it. What I've
24 heard is that you do want to work to help these folks
25 recover money.
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1 My name is Ron Proto. I'm an associate member of
2 CRRC. I'm a consultant, but I'm not a consultant that
3 generates 120-page contracts. I try to get them back down
4 to 20. But what separates me from most consultants is
5 that I've worked on their side as an operator for over 40
6 years, and I know what it is to negotiate a contract. The
7 language could be in there, but as Kelly Astor said and
8 Andy Rose said, it's only a starting point.
9 What I heard on the left was, "We need to put
10 language in there that allows them to recover." What I
11 heard on the right was, "Well, we should only be
12 advisories." What I heard in the center was, "Well, we
13 can't put too much in there because then we'll lose the
14 support of the cities." I ask you respectfully whatever
15 language you put in there to help the industry recoup its
16 dollars needs to be very clear and very specific. You've
17 made a regulation that's going to cost them a lot of
18 money. You should also put wording in there that allows
19 them to recoup it. Thank you very much.
20 CHAIRPERSON LLOYD: Thank you very much.
21 Doug Button, David Achiro, and Harry Miller.
22 MR. BUTTON: Good morning, Mr. Chairman, members
23 of the Board. I'm President of South San Francisco
24 Scavengers. We operate in the Bay Area approximately 42
25 vehicles. We've been in business since 1914, second/third
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1 generation run business by nine family members -- nine
2 different families, I should say.
3 First off, I'd like to say I applaud your work.
4 And I, too, express and share your concerns with the
5 environment, and I believe our company does too. I look
6 forward to the day we can come here and say we have
7 reduced particulate matter, NOx emissions are down. But
8 what I'm concerned about is what I hear your staff saying
9 is that you're going to require us -- and I mean my
10 industry and my company -- to retrofit, repower, or
11 replace 11,000 vehicles in the next seven years depending
12 on what category you fall into. But it will be within the
13 next seven years. That's a monumental task.
14 You're asking us to do it with technology that,
15 again, I hear your staff telling me have neither been
16 developed, tested, or that will be warranted for the life
17 of the equipment that we have to put it on. I hear them
18 say that in L.A. we've tried it on 360 vehicles. And so
19 the warranty shouldn't be a concern. Excuse me. L.A.
20 last time I was there was flat. And I operate in a very
21 hilly area. Where are the tests for San Francisco? I
22 heard nothing on that. I saw nothing in the reports. I
23 don't know anything about -- I heard nothing about the
24 Sierras or the Nevadas range where we still have companies
25 that operate.
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1 And yet, they're going to be putting on these
2 technologies and requiring us at the end of the day when
3 all of you pass these rules that we go home, we go to our
4 councils and we're asking where we have begging rights to
5 get more money to get this cost replaced. We go to them
6 and say, "Yes, we want to do it." While at the same time
7 we're telling them labor is going up. Insurance is going
8 up. Workers' comp, all these things. It's not going to
9 be easy, especially when we can't tell them this is
10 something everybody else is doing.
11 You're making us do this before the rest of the
12 state. We're held out as poster children that we've got
13 dirty trucks, and that's not the case. We have been
14 environmentalists for 89 years, and I think every other
15 company here is too. I'd love to see this happen. Don't
16 make us do it alone. Thank you.
17 CHAIRPERSON LLOYD: Thank you very much.
18 Ms. Witherspoon, I think you made an
19 understatement when you said the industry wasn't too happy
20 with us.
21 David Achiro, Harry Miller, and Alan Marchant.
22 EXECUTIVE OFFICER WITHERSPOON: I think you've
23 heard them all say they support our objective. It's all
24 concern about cost.
25 CHAIRPERSON LLOYD: Yes, exactly.
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1 MR. ACHIRO: Hi. I'm David Achiro from Tahoe
2 Truckee Sierra Disposal. We have about 40 trucks. I just
3 want to concur with Kelly and with Doug Button. I want to
4 make it short. I'm going to keep it short for you guys.
5 I concur with what they say.
6 We're in the Tahoe Truckee area. My father
7 started the business in 1964. Back then, we had one
8 truck, one, you know, tractor, and one pickup. And now
9 we've grown a little bit. But I just want to concur with
10 them that we do need to get the municipalities involved
11 with this, if this is going to work at all. Because they
12 can -- they can say no.
13 We just negotiated a contract with the county,
14 and we want to keep in good terms with them. But we -- we
15 were a little beat up. And without some sort of something
16 on the municipalities, they can -- even if we do give them
17 the information and the cost, they can still say no. I'll
18 just end it there.
19 CHAIRPERSON LLOYD: Thank you very much indeed.
20 Harry Miller, Alan Marchant, and John McNamara.
21 MR. MILLER: Good afternoon, Board members.
22 Thank you. And good afternoon, I guess. I'm with Tracy
23 Delta Solid Waste Management. We're the hauler for the
24 city of Tracy and the southwestern portion of San Joaquin
25 County. We operate some 50 vehicles there in the solid
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1 waste business. And it's a small family-owned company, a
2 second going into third generation right now. I am, among
3 other things, Recycling Coordinator with the company. As
4 with most small businesses, we wear a lot of hats.
5 Hopefully not too many of them at the same time because it
6 gets confusing.
7 I bring greetings from the Repetto family this
8 case, which is the owners of the company. And the reason
9 they're not here is because they're presently
10 negotiating -- well, probably having lunch now -- but
11 negotiating the agreement to upgrade the recycling
12 services for the city of Tracy to go into a full -- let's
13 call it a single-stream system now. That's another
14 subject.
15 We fully support clean air. We love in the
16 central valley of California and families and children,
17 what have you. And you know, we want everything that
18 everyone else wants, but we want businesses that are going
19 to survive as well.
20 We operate under a contract with the city of
21 Tracy and San Joaquin County and a couple of other areas.
22 In every instance we have the agreement that we can go
23 back and say, "Yeah, we've had this increased cost," but
24 it doesn't necessarily mean that they're going -- that the
25 city or the county or whoever is going to increase our
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1 funding. It's just all iffy. And in business we hate
2 being iffy.
3 Which brings me to the second point. You know,
4 the staff's numbers we think are a little bit fuzzy, just
5 simply. We operate, as I said some, 50 trucks. If we're
6 retrofitting 50 vehicles at -- I heard the number of
7 $9,000 or 9500, I believe it was a vehicle, we've got
8 $500,000 we're looking at. Our city and our surrounding
9 area, there's 20,000 people. At a dollar a home per year,
10 that's $140,000 over seven years. There's some bit of a
11 discrepancy here. So I have some question about the cost.
12 We operate old trucks for one very good reason;
13 we have to be competitive. We, unlike the large haulers,
14 can't afford to go out and buy new trucks all the time.
15 And the new recycling program we're putting in, we are
16 using trucks that we bought from one of the larger haulers
17 and we're refitting those at the present time.
18 I just recently heard one of the staff members
19 say that, "Well, you know, all the haulers are talking
20 about is cost." And I don't really think that's the case.
21 I think what we're talking about is survival. Because if
22 we can't recover our costs, there's a very good chance
23 we're not going to. And particularly small haulers are
24 going to be subject to predatory large companies coming in
25 and forcing us to sell.
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1 And with that, thank you very much.
2 CHAIRPERSON LLOYD: Thank you. We understand the
3 issue.
4 Alan Marchant, John McNamara, Richard Caglia.
5 MR. MARCHANT: I'm Alan Marchant, President of
6 Turlock Scavenger Company. Third generation in our
7 company. We've been here for 68 years in Turlock, and we
8 operate some 30 trucks. We're in the 30 truck category.
9 I would love to be able to cure the air pollution problem
10 in the San Joaquin Valley area. It's a soot bowl. We
11 know that. I have children, grandchildren, and definitely
12 don't want to see them with any problems either.
13 One of the concerns I have is we're a small
14 company. The only thing I can offer my city is service.
15 We don't have the big funds like the big companies. We
16 can't do that. The concern I have is we put the
17 particulate filters on these trucks -- a lot of our trucks
18 are the old trucks. We're not going to be able to repower
19 those trucks because they don't make engines for this
20 model of truck that we invested in in the past. We're
21 going to have to go out and purchase a lot of new trucks.
22 The concern I have is putting these particulate
23 filters on these newer trucks that aren't the 2007s and,
24 yeah, I know there's supposed to be a guarantee on this
25 particulate filter, but in the meantime, this truck blows
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1 up. That truck's sitting. And somebody's arguing who's
2 going to be who -- who's going to take care of that. I
3 got to get that truck on the road. I don't have a choice.
4 I have to pick up that garbage.
5 The other concern I have is I've probably got one
6 of the greatest rapports I think with my city. We have a
7 great city. They've just had major increases on clean
8 water issues and sewage issues and all this. For me to
9 come in and ask them for more money from my side, I
10 question it in this these times. And I can tell you that
11 if I don't get these rate increases to purchase these
12 trucks, I will be out of business. Thank you.
13 CHAIRPERSON LLOYD: Thank you. And rest assured
14 that -- I understand that you actually serve one of our
15 Board members, and that we will hear firsthand how this
16 rule is being implemented. So D.D. does a great job of
17 representing that part of the valley. And in this case we
18 really have -- we will have real time feedback. So rest
19 assured, I'm sure we will hear firsthand.
20 MR. MARCHANT: She does do a good job. And thank
21 you.
22 CHAIRPERSON LLOYD: John McNamara, Richard
23 Caglia, and Sean Edgar.
24 MR. McNAMARA: Good afternoon, Mr. Chairman. My
25 name is John McNamara, and I represent the CRRC Southern
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1 District. I'm here from Southern California this morning.
2 I want to share with you a case study. It's a
3 story about our recent experiences in Southern California
4 with fleet emission rules that taught us a lot. The South
5 Coast Air Quality Management District implemented the rule
6 1193 that regulates the refuse fleet industry in Southern
7 California. It's been in place for two years. My company
8 working for CRRC documented many failures that occurred in
9 the first year and -- actually year and a half of that
10 implementation. We provided a copy of that report to your
11 staff back in April.
12 And it documented -- and I want to highlight some
13 of the things -- some of the most notable things; 40
14 engines that were a failure in a fleet of 300 natural gas
15 vehicles. All the fuel tanks in one fleet of 30 natural
16 gas vehicles failed completely. The municipal fleet of
17 105 vehicles that had dual fuel vehicles had a 70 percent
18 downtime rate. We documented all that in order to try to
19 better the rule. And to this point, we're not satisfied
20 that's occurred with the South Coast AQMD.
21 As a result of that, what we also documented in
22 the refuse industry in Southern California is that truck
23 orders have flattened and are declining in sales. We now
24 in Southern California have less options for clean burning
25 engines. And in one case, one vehicle class or engine
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1 class we have no manufacturer that can provide us with the
2 product that some of the tractor trailer class of vehicles
3 that we have use for taking away from the transfer station
4 to the landfill.
5 In our opinion, as we've documented this, rule
6 1193 has actually resulted in dirtier air. We haven't
7 been able to move on to clean burning engines like we
8 wanted to and they're not available. There's less
9 providers now than when we started in the rule process.
10 The irony of this is that the private refuse
11 haulers have historically been out in front on this issue
12 of regulations in clean burning engine technology. We've
13 been -- you heard about some of them, how we had a propane
14 fleet and a CNG fleet. And we feel that the CARB rule --
15 and we provided you specific technical issues we feel
16 inhibit us from going forward with this same type of rule.
17 I want to give you an example of some of the
18 types of programs that the refuse industry has introduced
19 and done on a voluntary basis before the rules were ever
20 written.
21 CHAIRPERSON LLOYD: What should we be doing with
22 respect to this rule?
23 MR. McNAMARA: We provided you with written
24 comments earlier this month. We ask that dual fuel be
25 introduced as a option in the rule and be addressed.
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1 We've been asking for that for a couple of years. We're
2 not saying it be 100 percent adopted or embraced, but at
3 least you give us some consideration. And we've heard
4 some testimony on that earlier.
5 I also wanted to address one of the Board
6 member's comments that this is a small portion of the
7 fleet. Actually, the city of L.A. has 105 vehicles that
8 are being used right now. They're planning on adding 100
9 more so it will be 205 in the city of Los Angeles.
10 Republic Industries has about 30 dual fuel LNG vehicles.
11 Waste Industries has about 30 dual fuel vehicles. Waste
12 Management and BPI both have dual fuel vehicles.
13 CHAIRPERSON LLOYD: Just a matter of application
14 here from the legal counsel. Clearly, you're subject to
15 the South Coast fleet rule. If we pass this, which takes
16 priority?
17 MR. McNAMARA: I couldn't answer that.
18 GENERAL COUNSEL WALSH: Both rules would apply.
19 The rules have been --
20 CHAIRPERSON LLOYD: Both rules would?
21 GENERAL COUNSEL WALSH: Yes.
22 CHAIRPERSON LLOYD: How would both rules be
23 implemented?
24 EXECUTIVE OFFICER WITHERSPOON: Within our rule
25 BACT definition includes natural gas vehicles, so the
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1 purchase of any of these vehicles would apply. To the
2 extent that diesel vehicles also existed in some of these
3 fleets, existing diesel vehicles not subject to the
4 purchase requirements -- which is what the South Coast
5 rule does -- would be subject to the retrofit, repowering
6 or replacement. But as they got replaced, our rule would
7 push them into the South Coast rule. When you go waste,
8 then you have to buy a natural gas vehicle.
9 CHAIRPERSON LLOYD: With the natural gas you
10 mentioned some problems. Are they still operating them?
11 MR. McNAMARA: Not all of them. In some cases
12 the fleets have actually shrunk or parked the vehicles
13 because they don't have the support. We found a lot of
14 problems with the warranty issues and who's responsible
15 for what. For instance, an LNG vehicle, they have a fuel
16 tank. It's a cryogenic tank, and it costs about $5,000 as
17 compared to a diesel tank that costs maybe $200. Those
18 tanks were provided, and the warranties weren't extended
19 all the way through in the way they should have been. So
20 their product wasn't supported. Some of these -- like I
21 said, the city of Los Angeles had 70 percent of its fleet
22 parked last year.
23 CHAIRPERSON LLOYD: Do these vehicles have oxi
24 cats on them?
25 MR. McNAMARA: Pardon me?
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1 CHAIRPERSON LLOYD: Do they have oxidation
2 catalysts on them?
3 MR. McNAMARA: The city of L.A. might have on
4 some of them.
5 CHAIRPERSON LLOYD: What about your fleet?
6 MR. McNAMARA: I don't have a fleet. I'm just a
7 regulator service director for California Refuse Removal
8 Council.
9 CHAIRPERSON LLOYD: So it's just the city of L.A.
10 that has the oxidation catalyst?
11 MR. McNAMARA: That's the only one I'm aware of,
12 but there may be others.
13 EXECUTIVE OFFICER WITHERSPOON: Mr. McNamara also
14 brought up the issue of dual fuel vehicles, and we talked
15 about that earlier today with respect to San Diego and
16 15-day changes that we'll be looking at to address that
17 case.
18 CHAIRPERSON LLOYD: Thank you very much.
19 Sean Edgar -- oh, sorry. Richard Caglia.
20 MR. CAGLIA: My name is Richard Caglia. I
21 represent Industrial Waste and Salvage. I, too, am a
22 third generation family member. Our hauling company has
23 about 20 trucks currently. I'm not going to stand up here
24 and echo everything you've already heard. But there is --
25 I'm starting to feel like one of the first monkeys going
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1 into space with unproven technology and burdensome
2 technology and regulations that are going to cost our
3 company millions of dollars, potentially.
4 We're currently financing a $9 million facility
5 which is a new facility. It's a transfer station facility
6 and recycling facility. And I don't have to tell you
7 again what you've already heard. I just want you to know
8 that I'm here. We want to be part of the central valley
9 solution. We do support clean area. I grew up with
10 asthma, so I still deal with it. My daughter has it. I'm
11 currently a Board member in our local Mayor, Alan Autry's,
12 Task Force for Clean Air. I can appreciate everything
13 you're doing. I was up here during the Archie Crippen
14 hearings with the Waste Board. And I just appreciate you
15 listening to what we have to say. And we appreciate
16 further comment and study from the staff's perspective.
17 And I don't want to feel like a monkey anymore. Thank
18 you.
19 CHAIRPERSON LLOYD: Thank you very much indeed.
20 Sean Edgar, Paul Wuebben, Ruben Martinez.
21 MR. EDGAR: Chairman Lloyd and Board members,
22 thank you. I'm Director of Regulatory Affairs for the
23 California Refuse Removal Council, north district. In
24 this capacity I've personally spent more than 500 hours
25 working on this rule package alone. Much of that quality
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1 time has been spent with Ms. Witherspoon and your staff.
2 And to not belabor this, but there are a few
3 quick issues I want to address, number one being our
4 industry does not build itself using uncertainty as its
5 guide. I've heard you mention San Diego so I just want to
6 follow up very quickly. Mr. Medonza was before your Board
7 in April and went out and bought plus or minus of these
8 super duper all fuel trucks and only eight of them
9 grenaded, but we're really committed to the program. Ten
10 percent failure rate -- I don't know if any of the eleven
11 members of your Board, if one or two or more of you would
12 be satisfied with a lesser degree of service when you roll
13 your recyclable or garbage cart out to the curb, we would
14 like to know that as an industry. Because we do not
15 invest hundreds of millions of dollars in building the
16 facilities and the infrastructure to enjoy the benefits
17 that our industry is instrumental in providing to all
18 Californians in terms of resource conservation.
19 And perhaps your staff really hasn't zeroed in on
20 the amount of air quality benefits that recycling delivers
21 now. As an example, material recovery versus virgin
22 resources. Fed EPA is an example, has some very
23 compelling evidence that tells us that 90-plus percent
24 reductions in air emissions from using recyclable aluminum
25 versus mining new aluminum. The same for paper. Plastic
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1 has its benefits. The air quality emissions that we're
2 delivering by virtue of every fewer ton that we put into
3 the landfill every day is an exact benefit.
4 We're not coming forward as someone in the ag
5 team may have said, "Hey, we're a sacred cow, please don't
6 regulate us." This business has been used to being
7 regulated. We were regulated for public health and safety
8 reasons. We're regulated because we need to establish a
9 recycling mandate. In the same room every month, the
10 Waste Board tells the cities we serve, "recycle or die."
11 That is our livelihood. And I say very clearly,
12 we've heard comments today from your staff and also from
13 the folks behind me, and I'm also speaking for the 20 or
14 30 others members who are out running their companies
15 today, we heard very clearly from them, they cannot rely
16 on uncertain technology to carry out their critical
17 business. They cannot rely on "maybe." When it comes
18 down to whether they'll be able to pick up your garbage or
19 recyclables, "maybe" does not work.
20 The last thought I will leave you with -- and due
21 to this tremendous degree of uncertainty, specifically in
22 Item 56 in the package, pages 3 through 6, there are about
23 20 bullets of specific requests that were made from this
24 Board. We have highlighted those requests with your staff
25 and many of them for an extended period. And staff, yes,
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1 in the last few days have really been able to zero in to
2 understand some of the frustration and anger that is
3 expressed by the folks behind me.
4 The last idea I will give you is that we are
5 committed to work through some amendments to this package
6 that make it more acceptable. Ultimately if we fail, you
7 as our customers fail. The cities and counties mandated
8 to recycle fail. When everybody goes away and microphones
9 are dead and the lights go down and our companies need to
10 go out, the truck needs to turn over at 3:00 in the
11 morning. We're not at the stage with the technology that
12 our people are comfortable doing that.
13 They cannot risk the continued livelihood of
14 their families on a maybe, on a birthing process, on an
15 uncertainty that's not quite there yet, on representations
16 from folks who want to sell all sorts of different
17 products they can't stand behind long enough in order for
18 us to successfully use it in a field. Because as
19 Mr. Pellegrini indicated, where the rubber meets the road
20 is where our obligations to you as our customer is. And
21 we are not at that stage yet.
22 Appreciate your attention. And I will dedicate
23 myself to another several hundred hours or however long it
24 takes to get through what our members, the folks that are
25 here, and the ones who aren't here need to get out of the
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1 package. We figured out how to make recycling work. We
2 can do this, figure out how to make this work. We need to
3 do a lot of tweaking on it. We're dedicated to do it.
4 Appreciate your time today. Thank you.
5 CHAIRPERSON LLOYD: Thank you.
6 We got a change in order here. It's Chuck
7 Helget, Kent Stoddard, David Wilson, then Paul Wuebben.
8 You'll see Board members going periodically to
9 the back. We're trying to get a lunch. But there's
10 microphones back there so we can hear -- speakers back
11 there so we can hear back there. So that's what you see.
12 But we will be taking a shortened lunch break. We're
13 listening all the time.
14 MR. HELGET: Mr. Chairman, members of the Board,
15 I'm Chuck Helget representing Allied Waste Industries.
16 And Allied Waste Industries is offering qualified support
17 for this rule. Allied is the second largest waste hauler
18 in the country, and we have about 1500 vehicles operating
19 in California.
20 Again, we're offering qualified support of the
21 regulations because we believe that a reasonable and
22 technically sound statewide program for particulate matter
23 reduction is in the best interest of the communities that
24 we serve. From our perspective, however, this is not just
25 about cost recovery from the industry's perspective. It
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1 is about technology, technology availability, and
2 technology warranties, and about cost controls on these
3 technologies.
4 We are concerned that the rules proposed depend
5 heavily upon the availability of control technologies that
6 are not yet commercially available or verified to achieve
7 the various minimum levels of the PM reductions. We are
8 also concerned that there is no reasonable estimates that
9 the cost of applying these yet-to-be-determined
10 technologies and for the new infrastructures necessary to
11 implement some of the alternative fuel technologies.
12 In order to provide our customers with reasonable
13 priced solid waste collection, we need a dependable fleet
14 of solid waste collection vehicles and a cost effective
15 fleet. The time line for converting our fleet is
16 critically tied to the availability of control
17 technologies and to the operation of reliability of those
18 technologies. At a minimum, we believe the rule should
19 stipulate that the warranty period for those -- for the
20 hardware portions of the diesel emission control
21 strategies be about ten years.
22 The compliance extension authority granted to
23 executive officers, as we said in our letter, we believe
24 shouldn't be discretionary. And we also want to ensure
25 this rule remains balanced and encourages innovative
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1 technologies that achieve the state air quality goals in
2 the most economically efficient manner.
3 Allied has implemented a biodiesel strategy for
4 our fleet in Chula Vista with excellent results using a 20
5 percent biodiesel blend with an additive called ethos. We
6 have achieved field verified 70 percent PM reductions for
7 the entire fleet and strongly urge the Board to include
8 biodiesel as a compliance option. The current
9 verification process is expensive and extensive, and as a
10 result discourages, to some degree, technological
11 innovation. The rule should encourage high compliance
12 standards and cost effectiveness by providing the
13 flexibility of the fuel industry's projects. When the
14 technology has been proven in the field, there should be
15 some mechanism to allow that technology to be used until
16 the compliance strategy has been completed in the lab.
17 Finally, these costs -- if the costs that we bear
18 from these technologies is significantly higher than your
19 staff has estimated, we will have a very difficult time
20 passing these costs through, not just with the communities
21 we serve and the franchises agreements that we have with
22 them, but with the commercial customers. Because the
23 pricing for our commercial accounts are what the market
24 will beat. And it will be difficult.
25 This is why we urge the Board to ensure that
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1 local governments are kept in the compliance loop. And in
2 doing that, we believe it will ensure that we all share in
3 the common goal of achieving a higher level of compliance
4 and cost effectiveness through a fair rate setting
5 structure. We support the Board's efforts here --
6 BOARD MEMBER HUGH FRIEDMAN: Excuse me, sir.
7 Your time has elapsed.
8 MR. HELGET: We support the Board's efforts today
9 and pledge to work with the Board and staff.
10 BOARD MEMBER HUGH FRIEDMAN: Thank you very much.
11 Any questions?
12 Mr. Stoddard. Kent Stoddard.
13 MR. STODDARD: Mr. Chairman, members, Kent
14 Stoddard representing Waste Management. We are the
15 largest fleet of solid waste collection and recycling
16 vehicles in California. We have approximately 3500
17 collection vehicles and about 10 or 12 percent of the
18 number are dedicated to 100 percent natural gas vehicles.
19 We met with staff yesterday about the rule to
20 express our concerns along with other representatives of
21 the industry. And as a result of that meeting, we're
22 supporting the rule. But I want to make it absolutely
23 clear this is a leap of faith for us. We have many of the
24 same concerns that have been articulated by all of the
25 small haulers.
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1 In effect, I'm a collection of small haulers. We
2 have about 70 terminals running on average 50 trucks at
3 each one of those terminals. This is a monstrous program
4 for every hauler, whether they're big or small, to
5 implement.
6 And what I would ask the Board today is to really
7 look hard at this issue of stranded costs. There are
8 many, many haulers that are going to have a tough time
9 recovering the costs from local government. And there's
10 been some discussion today about maintaining the proper
11 balance in the rule. But the fact of the matter is in the
12 operative language of this particular rule, there is no
13 balance at all. The burden falls entirely on the local
14 hauler -- that private hauler to comply with the rule.
15 What we're asking today is that you go as far as
16 you can with intent language and an expression of what the
17 desire of this Board is to encourage local governments to
18 work with their haulers. I think at some point we need
19 some joint workshops with the industry, with environmental
20 groups, with the League of Cities, with the Board to make
21 sure local governments clearly understand the benefits of
22 this rule, and they are huge. I mean, this is a very cost
23 effective regulation. It will either fall on the industry
24 at a cost of $100 million or more, much of which they
25 can't recover, or it will be passed through to every
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1 consumer, every rate payer at a rate of about 12 cents per
2 month for clean air.
3 So we are strongly supportive at what you're
4 trying to do. This is a good rule. But there are some
5 issues that have to be addressed. We're all nervous about
6 the technologies. We haven't used these technologies very
7 much. We've seen enough to feel like we can get through
8 it. But this issue of making sure we don't have stranded
9 costs, which would have just a devastating impact on
10 companies, whether they're large or small, is really a
11 critical issue.
12 We would really ask that at the end of the day,
13 at the end of this hearing when it's time to sit down and
14 work out that language, do everything you can to express a
15 clear interest that this is a partnership between haulers
16 and local governments and Air Board to make sure this
17 program is fair and equitable and works. Thank you.
18 BOARD MEMBER HUGH FRIEDMAN: Thank you.
19 Any questions?
20 BOARD MEMBER RIORDAN: Mr. Chairman, just to the
21 staff. Regarding the meetings that Mr. Stoddard asked
22 for, that seems to be a realistic request where you would
23 get those effected parties in a room. Is that your idea
24 with outreach that you might do in terms of our role --
25 education bringing together the various constituents?
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1 EXECUTIVE OFFICER WITHERSPOON: We haven't fully
2 thought through exactly what form the outreach would take.
3 I was happy to hear the suggestion for the workshop and
4 was immediately nodding at staff yes, let's do that. And
5 let's get the Waste Board there with us, along with the
6 cities and the waste haulers and the rest to bring these
7 issues together.
8 And Supervisor DeSaulnier and I were talking
9 about it, too, having a sidebar of how do we accomplish
10 this both prospectively before the rate haulers show up to
11 ask for what they need, and retroactively to keep tabs on
12 how it's going and if we need to do follow-up outreach.
13 BOARD MEMBER RIORDAN: I think it's very
14 important prospectively because while the haulers have
15 certainly had an opportunity to work through this, most of
16 the cities have relied on their key staff people here in
17 Sacramento, League of California Cities or the Association
18 of County Governments. But they've not been individually
19 properly involved, except maybe a rare few. And I think
20 we need to reach out to all of those city councils and all
21 of those boards of supervisors because they're the ones
22 that are, you know, having their staff negotiate
23 contracts, and to understand why there may be a need to
24 reopen the discussion on capturing some of the costs of
25 this program. So I think it's an excellent idea,
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1 Mr. Stoddard, and we need to move forward on that.
2 MR. STODDARD: Thank you very much.
3 BOARD MEMBER HUGH FRIEDMAN: Mr. Stoddard, you
4 have an attachment to your letter dated today, which
5 proposes additional language for a resolution. It seems
6 to be very similar to the 15-day notice. Is it similar to
7 the one staff came back with?
8 MR. STODDARD: It's very similar to the one staff
9 came back with.
10 CHAIRPERSON LLOYD: What we already have.
11 MR. STODDARD: The only difference I actually did
12 notice when they showed it to me yesterday is I think the
13 staff has come back and suggested biennial review as
14 opposed to an annual review. There may be a 'tweener
15 there. We'd like to see an annual review, at least in the
16 early years of implementation. If things are going well,
17 as we hope they will, we can go to a biennial review. We
18 feel that that's a really critical mechanism. There's a
19 lot of trust here in local government stepping up to do
20 what needs to be done for the implementation of this rule.
21 But we would say let's trust and let's also verify and
22 make sure that this is actually going to work.
23 BOARD MEMBER HUGH FRIEDMAN: Are there any
24 particular reasons for the biennial rather than annual?
25 EXECUTIVE OFFICER WITHERSPOON: It's just staff
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1 resources. I think that Mr. Stoddard is right, it should
2 start at annual and become biennial. The other nuance is
3 that his language talks about surveying regulated haulers
4 only, and it would be our intent --
5 BOARD MEMBER HUGH FRIEDMAN: You're talking
6 broadly?
7 EXECUTIVE OFFICER WITHERSPOON: We would talk to
8 the municipalities about their interpretations.
9 MR. STODDARD: We're fine with that. We agree.
10 BOARD MEMBER HUGH FRIEDMAN: I think we have time
11 for maybe one for two more before the reporter needs to
12 take a break.
13 Mr. Wilson.
14 MR. WILSON: Good afternoon. My name is Dave
15 Wilson. I represent the city of Los Angeles, Department
16 of General Services, Fleet Services. And there's been a
17 lot of stuff talked about our fleet. I'm kind of here to
18 set the record straight of what is happening with our
19 fleet.
20 Basically at this time we have 350-plus vehicles
21 fitted with the retrofit program of the particulate trap.
22 We also have about 150 to 160 dual fuel vehicles also
23 fitted with traps, but they were purchased from the
24 factory and the dealer. And to make a long story short,
25 we've had pretty good luck with them. There's been some
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1 failures. The failures that we have had, the
2 manufacturers have stepped up -- either the manufacturer
3 of the truck or the manufacturer of the trap has basically
4 stepped up to the plate. We were having an issue at one
5 time with the traps breaking apart. There was some
6 integrity issue with the trap itself. They stepped up to
7 the plate and fixed it.
8 It was mentioned earlier L.A. is flat. L.A. is
9 not flat. I have trucks that work exclusively in the
10 hills, Hollywood Hills, Pacific Palisades. And then the
11 only landfill that I have basically I have to pull 6
12 percent grade. So I mean, this technology that we have
13 that we're working pretty good with basically is being
14 tested on a pretty good basis.
15 I don't know -- again, a lot of other stuff was
16 thrown out. We have invested a lot in all fuel and these
17 resources. We have two fuel sites going for dual fuel.
18 We have invested in some new shops that are all fuel
19 compliant. Basically this is an undertaking that we kind
20 of saw the handwriting on the wall. We decided to go with
21 it, and we have committed to it totally.
22 There have been some issues. There have been
23 some mechanical issues. But I've been involved in the
24 truck repair industry for close to 30 years, and I've had
25 a whole fleet of trucks out for a rear-end or transition.
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1 So I mean, to hold this technology to a higher standard
2 than that is unfair also.
3 Again, you know, if there's any questions I can
4 answer.
5 CHAIRPERSON LLOYD: Thank you.
6 Any questions?
7 BOARD MEMBER RIORDAN: Only, Mr. Wilson, would
8 you be willing to serve as sort of a resource for people
9 who do want more information? Are you available for that
10 if the city -- so that if people want to talk to you,
11 other haulers, to see what your experience has been, would
12 you give them that information?
13 MR. WILSON: Absolutely. And all the same
14 questions that are being asked here, all the same fears,
15 we've been through that already.
16 BOARD MEMBER RIORDAN: Would you participate in
17 some of our outreach that we want to do early on in this
18 process when we talk to the various people who are going
19 to be involved?
20 MR. WILSON: Absolutely.
21 MS. RIORDAN: Thank you.
22 CHAIRPERSON LLOYD: Thank you.
23 On that high note, we'll take a very brief recess
24 for the reporter. Five minutes, seven minutes, something
25 like that.
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1 (Thereupon a recess was taken.)
2 CHAIRPERSON LLOYD: I'd like to restart.
3 Continue with Paul Wuebben, Ruben Martinez, and
4 Dr. Kubsh.
5 Sorry to keep you waiting, Paul.
6 MR. WUEBBEN: Thank you very much, Mr. Chairman.
7 For the record, I'm Paul Wuebben representing South Coast
8 Air Quality Management District. And to address first the
9 important question that the Chairman has been asking, we
10 have no refuse trucks, but we have lots of smog. So with
11 that, we did provide a comment letter on this rule. And
12 just to briefly summarize, that we strongly support the
13 staff-recommended rules. We certainly appreciate the
14 complexity and the pragmatism that the Board is struggling
15 with here, and we do think that the staff's 15-day changes
16 that were brought forward are certainly sound and well
17 reasoned.
18 We would request that you consider some
19 acceleration of the implementation, as it's been suggested
20 by the staff. If there were some acceleration of one of
21 the categories -- for example, I think they mentioned 14
22 percent enhanced PM reduction -- or an 18 percent
23 increased benefit with a 14 percent increased cost, based
24 on the tremendous cost effectiveness of this rule, it
25 would seem to be that would be a reasonable balance of
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1 benefits to cost. But we'll certainly let you sort that
2 out. But we would suggest that you at least consider
3 providing the local districts possibly the authority to
4 consider enhancing those timetables and accelerating them.
5 So with that, I just would close by commending
6 the staff for a lot of diligent work, especially in the
7 updating of all the cost factors and in keeping this and
8 all these changes, I think, relevant to the marketplace.
9 And we close with urging your adoption of the rule.
10 CHAIRPERSON LLOYD: Thank you very much, Paul.
11 We appreciate it.
12 Ruben Martinez and Dr. Kubsh.
13 MR. MARTINEZ: Mr. President, Board members, my
14 name is Ruben Martinez. My company is Diesel Air Fleet
15 Service. I'm a smoke testor. I've been smoke testing
16 diesel for five years now.
17 I actually just came to see what was going on in
18 Sacramento. I service the Southern California area. And
19 in listening to the discussion and reading some of the
20 material, I'm in favor of any program that's going to help
21 reduce PMs and NOx. I just saw a couple of slides about
22 NOx. PM naturally we can see. It's visible. What I see
23 and hear, it's going to be a hardship on smaller companies
24 and generally every one.
25 But what I would like to see is maybe from a
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1 different angle. You know, what I see out there is that
2 there isn't the presence and the enforcement of the
3 companies that are not complying. I have companies that
4 refuse to comply. I have companies that crank up the
5 engine -- I also used to be 22 years diesel mechanic --
6 deliberately. And I would like to see more presence of
7 the ARB out there and a governing force in which to, you
8 know, put more stringent on these people. And if we were
9 just to do that, we'd be able to bring the PMs
10 substantially down.
11 I have also tested some of the catalytic
12 converter particulate traps. And with the new
13 technologies over the engines, they're real close. So to
14 me it's like a waste of money. I would rather them go
15 through NOx, you know, focus more than the PM, because
16 that's going to clean up with the new technology.
17 But just in saying that, it is going to create a
18 hardship. But I would like to see more presence of the
19 ARB enforcement out there because it would really help a
20 lot of these people that are not complying.
21 Thank you very much.
22 CHAIRPERSON LLOYD: If I understand it correctly,
23 if we are successful in eliminating air pollution and
24 eliminating visible emissions, you're out of business too?
25 MR. WUEBBEN: I'll be out of business too.
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1 CHAIRPERSON LLOYD: A laudable goal for both of
2 us. We have a way to go.
3 Professor Friedman.
4 BOARD MEMBER HUGH FRIEDMAN: Mr. Martinez, one
5 quick question. When you say the polluters are out there,
6 are you talking about waste haulers or are you talking
7 about --
8 MR. MARTINEZ: I have waste hauler customers. I
9 have trucking customers. I have bus people, yes. And I
10 have independent contractors that I can get because they
11 got fined, so they need to be smoke tested.
12 BOARD MEMBER HUGH FRIEDMAN: So they do get fined
13 sometimes?
14 MR. MARTINEZ: Yeah. So you need to get what --
15 I have a graph I give my customers comparing each year so
16 they see where their vehicles are. And I have some
17 customers that really want to improve. And really, you
18 know, do better so I'm happy for that.
19 CHAIRPERSON LLOYD: Thank you.
20 MR. MARTINEZ: Thank you.
21 CHAIRPERSON LLOYD: That raises, of course, the
22 issue -- and Paul, you can maybe recount for me the status
23 of the South Coast visible emissions reporting program.
24 Is that still active? Maybe tell our staff what happens
25 when we use the call-in number. Is this still active,
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1 Paul?
2 MR. WUEBBEN: I don't believe that it is.
3 CHAIRPERSON LLOYD: You'll have to get back to
4 me. Okay.
5 What about our staff, any --
6 GENERAL COUNSEL WALSH: We do have our smoking
7 vehicle line, which is still operational. And we do get
8 calls on it on a regular and on-going basis.
9 CHAIRPERSON LLOYD: Okay. Thank you.
10 Joe. Joe, and then Scott Smithline and Karen
11 Wilson.
12 DR. KUBSH: Good afternoon, Dr. Lloyd and members
13 of the Board. My name is Joe Kubsh. I'm Deputy Director
14 of the Manufacturer's Emission Control Association, and
15 I'm here to indicate our industry's strong support of the
16 proposal that's been put in order by staff today.
17 We think this proposal represents a balanced,
18 fair, and flexible approach to achieve significant PM
19 emission reductions and refuse hauler fleets here in
20 California in a cost effective manner. We've provided our
21 written comments.
22 I'd just like to make a few comments with respect
23 to some of the technology remarks that were made by some
24 of the previous fleet operators, just to maybe allay some
25 of their concerns about the technologies that -- the
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1 retrofit technologies that will be used to help provide
2 some of the reductions in this rule. Obviously, it's not
3 staff's intent or our industry's intent to force people to
4 put filters on technologies where they won't work. That's
5 why the verification process we worked very diligently
6 with staff on is there to guarantee there's a good match
7 between technologies and the applications and that they're
8 proven to work in these applications.
9 And as indicated by the staff presentation, the
10 experience in Los Angeles and New York with putting
11 filters on refuse haulers has been excellent. The
12 experience based on filter applications both on these
13 classes of vehicles and others is growing every month. By
14 our count, there are more than 70,000 filter-equipped
15 vehicles in the world today. Most of those being
16 retrofits. And when there's a good match between the
17 temperature window characteristics that are required to
18 achieve generation in the applications, the experience has
19 been excellent. And we are confident that that experience
20 will be the same here in California.
21 But we also understand that filters will only
22 play a part of the role in achieving the reductions that
23 are required by this rule. And it's important, I think,
24 for the fleet operators to understand that, again,
25 technologies will be verified to work with certain
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1 temperature window constraints, in the use of ultra low
2 sulfur fuel, for example. And those technologies will not
3 be forced into applications where they're outside of those
4 boundaries.
5 So, again, I want to commend the staff for the
6 fine work they're doing in this area. We continue to work
7 very closely with them in trying to understand the role of
8 retrofit technologies in these fleets and other fleets
9 that you'll be considering in the coming months. And with
10 that, I'd be happy to answer any questions that you might
11 have.
12 CHAIRPERSON LLOYD: Thanks. You'll be
13 participating in the meeting next month?
14 DR. KUBSH: Yes, we will.
15 CHAIRPERSON LLOYD: Will you be here also for the
16 next item?
17 DR. KUBSH: Yes, sir.
18 CHAIRPERSON LLOYD: Any questions?
19 Thank you very much.
20 Scott Smithline, Karen Wilson, Todd Campbell --
21 Councilman Campbell.
22 MR. SMITHLINE: Mr. Chairman, Board members, my
23 name is Scott Smithline. I'm with Californians Against
24 Waste. Californians Against Waste has been advocating for
25 environmental protection and promoting and recycling
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1 economy for 25 years. We are in strong support of these
2 proposed measures today.
3 I won't go into the health effects of particulate
4 matter. It's, at this point today, obviously been well
5 established.
6 We do have some concerns, however. We are
7 concerned that the proposed measures failed to adequately
8 deal with the financial relationship between contract
9 service providers and the local agencies. Many of these
10 fleets, as it's been testified to today, are under these
11 long-term contracts that are rate regulated. We think
12 this will have on the ground, environmental impacts.
13 Basically the situation as we see it is
14 there's -- not only is there no incentive to try to
15 achieve the best environmental compliance, but there's
16 actually a restriction on funding to do that. As I said,
17 we think this will have real environmental impacts. We
18 would ideally like to see a very different approach,
19 something like Senate Bill 1078, Chesbro's Bill, where
20 there would be a fund set aside by increased tipping fees.
21 We understand that's not your venue. But until such time
22 as something like that becomes available, we would
23 definitely like to see local agencies be required to work
24 with the contract service providers in such a way that
25 funding compliance -- funding for compliance will be
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1 established.
2 Again, we are in very strong support of these
3 measures, and we urge you to adopt them with the
4 amendments proposed by the NRDC. However, at the same
5 time, we also urge you to take the strongest steps you can
6 to ensure that funding will be available for compliance
7 with these measures. Thank you.
8 CHAIRPERSON LLOYD: Thank you very much.
9 Karen Wilson.
10 MS. WILSON: Good afternoon, Mr. Chairman and
11 members of the Board. My name is Karen Wilson. I'm
12 Director of the Strategic Planning Division for the
13 Sacramento Metropolitan Air Quality Management District.
14 We would like to thank your staff for the hard
15 work that they have done on this measure and note that we
16 have worked with them for a number of years because, as
17 you are aware, our region continues to struggle to meet
18 the one-hour federal non-attainment standard for ozone.
19 And we are NOx limited, and so NOx reductions are what
20 we're going to have to get or we will fail to meet our
21 goal by 2005.
22 As you move forward with this regulation, your
23 staff has included NOx reductions as one of the flexible
24 BACT requirements that allows NOx reductions to occur. We
25 really appreciate that. We anticipate that this measure
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1 will get us up to a third of a ton a day of NOx reductions
2 as written with that option in it, so we appreciate that,
3 in addition to the .02 tons per day of diesel particulate
4 reductions. That's very important on the ground in the
5 neighborhoods.
6 And I would like to point out, furthermore, that
7 our city and county of Sacramento have worked with us over
8 the last few years to convert their refuse fleets to
9 alternative fuel vehicles. Those are dual fuel trucks.
10 There's about 130 trucks between those two jurisdictions.
11 I have been in touch with your Ombudsperson today
12 to indicate that I don't know why the city and county are
13 not here, but they would be included with San Diego with
14 that request that as you look at that 15-day period for
15 additional comment and working through issues, that those
16 dual fuel trucks that don't meet the full particulate
17 emission reduction requirement in this rule. They come
18 very close, but they were certified with the diesel in it
19 as part of the certification. So that would void both
20 their certification and their warranty, apparently, to
21 change that out -- that technology out at this time. So
22 we're in with San Diego and perhaps some from the
23 discussion of L.A. County as well.
24 So we have been assured by your staff, as we were
25 sure we would be, that you'll meet with the city and
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1 county of Sacramento as well in clarifying the impact of
2 this rule on the dual fuel vehicles they have in place
3 because they taken the liberty of only about half. So
4 they still have -- as you know, the ordering time line on
5 these vehicles is very long. And they won't have the
6 orders that they put in until the end of 2004. So they
7 have an existing issue with those that have that been
8 delivered, as well as money they committed, some of their
9 -- from their tobacco settlement money, recognizing the
10 public health link. They've been very cooperative with
11 us. These were purchased a couple years ago in
12 anticipation of NOx reduction benefits, when we did
13 calculate the particulate emission reduction benefits at
14 that time. However, as you move forward with this rule,
15 we've gotten a little bit behind you.
16 So thanks very much for the work your staff has
17 already done. We hope that our city and county can be
18 included in those discussions.
19 CHAIRPERSON LLOYD: Thank you very much.
20 Councilman Campbell, Bonnie Holmes-Gen, Tom
21 Addison.
22 COUNCILMAN CAMPBELL: Thank you, Chairman Lloyd.
23 Todd Campbell, Policy Director for the Coalition for Clean
24 Air and Councilmember for the city of Burbank.
25 I just want to first say that we're going to miss
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1 you, Kathleen, but we're looking forward to working with
2 you in the Bay Area.
3 I also want to thank the Chairman and others that
4 attended the Port of Los Angeles trip. I was with the
5 Governor when he announced that Kenneth Hahn Park -- his
6 plans to reduce emissions down at the ports. And as you
7 said, the Port of Los Angeles and Long Beach combined
8 being the third largest port in the world expecting to
9 triple by 2020, it's a very important first step. And
10 we're hoping to see further commitments in the future.
11 CHAIRPERSON LLOYD: I can comment, Todd, if you
12 haven't had a tour down there, it's really worth while.
13 COUNCILMAN CAMPBELL: Absolutely.
14 CHAIRPERSON LLOYD: And I know you had a lot to
15 do with pushing to clean it up. It seems to be working.
16 COUNCILMAN CAMPBELL: We'd like to think so. And
17 we're going to keep on trying. We're not done. But thank
18 you, Chairman.
19 Board members, I stand before you today in strong
20 support as an advocate and a Councilmember of the rules.
21 And I think I join at least seven other public health and
22 environmental groups in addition to dozen of cities that
23 firmly support the rules in prior testimony.
24 The adoption of this rule before you today is
25 instrumental in the emissions reduction goals set forth in
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1 the agency's diesel risk reduction plan, which was
2 originally adopted -- or started since our adoption of the
3 risk with the acknowledgement of the toxic air contaminant
4 identification of diesel particulates in 1998. As you
5 know, diesel particulates are extremely harmful,
6 especially not only for our urban but also for our rural
7 areas in California.
8 Controlling diesel PM from refuse trucks is
9 critical because waste collection vehicles spew toxic
10 diesel PM throughout residential neighborhoods. And as a
11 Councilmember, I cannot tell you how many times I get
12 constituents complaining about refuse trucks running up
13 and down their streets. I must at least get one call a
14 week, sometimes five calls a week. And the biggest
15 frustration for me as a Councilmember is I can't regulate
16 the contracted portion of our fleets. We're a
17 full-service city. But we do have for the long haul
18 contracted fleets.
19 And in terms of costs, I can only speak for the
20 city of Burbank. But I know that my staff or at least the
21 City Manager at the city of Burbank would be more than
22 willing to do to the right thing and work it out with the
23 waste haulers. I don't see that as an issue. Certainly,
24 there will be some negotiations. But I certainly see and
25 I also view my Council as being proactive. And especially
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1 given we're inside or way deep in the South Coast air
2 basin, it doesn't take a genius to figure out that we have
3 an air quality problem, and we need to do everything we
4 can to reduce not only emissions that are like smog
5 emissions, but also reduce toxic emissions in our
6 community.
7 Despite our strong support, we would like to
8 actually encourage some strengthening. And this is
9 particularly what you're interested in, Chairman. It's
10 the -- we would like to see the cleanup of the pre-1988
11 vehicles move forward two years to 2005.
12 The staff has run analyses. They found it would
13 be more cost effective. They also found that it would
14 reduce 175 tons of additional toxic PM. And there are
15 some concerns that were raised by the waste hauler
16 industry. I acknowledge that. I want you to remember
17 that there's a one year exemption. I think that partially
18 addresses the issue of cost because certainly cities that
19 do have the contracts with refuse haulers can renegotiate
20 I think within a two-year period. For example, if you
21 have a city that's not willing to renegotiate, you know,
22 the exemption may be granted by the Air Resources Board,
23 and then you'd have two years.
24 I think that would also give adequate time for
25 city councils and staff to get educated on the issue, and
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1 I think that's really one of the main important goals that
2 we all have here in this room is to educate city councils
3 and local government about how important it is to reduce
4 diesel exhaust.
5 And in terms of technology, really the
6 representative from the city of Los Angeles really
7 explained most of what I wanted to express to you, but
8 certainly diesel particulate filters and advanced
9 technologies have not -- this is not the first time we are
10 applying them. We have applied them also with the school
11 bus rule, which you know has been overcommitted in terms
12 of well subscribed, and certainly you don't have districts
13 turning away that money on those traps. I think it's been
14 a very effective program, and the children are benefiting
15 from that.
16 The second thing that we would ask of the Air
17 Resources Board is to not allow first -- or Level 1 in
18 Level 2 traps for these pre-1988 vehicles. We think that
19 these vehicles are so polluting -- remember, they're ten
20 times the emission levels of a 1994 model year refuse
21 truck. So they are tremendous amount of -- source of
22 pollution in the vehicle fleet. We would suggest that
23 they either retire them, they either repower them, or they
24 retrofit them with a Level 3 trap, which achieves about an
25 85 percent reduction in PM emissions.
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1 Third, we would ask that at a later date the Air
2 Resources Board commit to future NOx reductions. In other
3 words, we'd like to see a commitment from the Board and
4 staff of developing a regulation that would specifically
5 address smog forming oxide in refuse vehicles at a later
6 date. You know, given next months's meeting, we have a
7 tremendous task in front of us to reduce emission or smog
8 forming emissions, and I think that needs to be at least
9 put out there so that we have in our sites and we see
10 opportunities as technology advances to take advantage and
11 harness those opportunities.
12 And then finally, we support the staff proposed
13 changes that limit the exemption to one-year for pre-1988
14 vehicles.
15 In conclusion, I want to leave you with one last
16 thought. The air quality in the South Coast air basin is
17 the worst that it's been in the last six years or six
18 years ago. The San Joaquin is no different. In fact, I'd
19 say it's in the worst shape it's ever been. We are
20 running out of time to reach attainment by 2010, and every
21 opportunity that we miss prevents us from achieving all of
22 our -- you know, the goal that I think we all share.
23 And I just want to say that I urge you to take action and
24 adopt a strong refuse rule today to stay the course for
25 future fleet rules that intend to reduce diesel toxic PM
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1 and smog-forming nitrogen oxides. With that, I thank you.
2 CHAIRPERSON LLOYD: Thanks very much, Todd.
3 Thank you.
4 Bonnie Holmes-Gen.
5 MS. HOLMES-GEN: Thank you, Mr. Chairman. Bonnie
6 Holmes-Gen with the American Lung Association of
7 California. And we also are a strong supporter of the
8 rule that's before you today. In fact, I don't think we
9 can overemphasize how important this rule is to all of us
10 and especially to everyone who suffers from lung disease
11 such as asthma or other lung diseases.
12 You've singled out in your staff report the
13 premature deaths, and the number is very dramatic and
14 compelling. And I think that it's very helpful to
15 understand that we are preventing up to 80 premature death
16 by 2020. But premature deaths is really the tip of the
17 iceberg, as you know. It's just as important to look at
18 the numbers of asthma attacks that would be prevented, the
19 number of upper and lower respiratory illnesses,
20 hospitalization from lung and heart disease, emergency
21 room visits, chronic bronchitis, school absences. There
22 are so many impacts that are going to be avoided by
23 reducing diesel pollution from these vehicles and from
24 other vehicles in the fleet. So I just wanted to point
25 out, of course, as you know, the impacts are so widespread
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1 and affect so many people and the quality of life for so
2 many in California, especially children.
3 Our emphasis in this rule and others that you'll
4 be looking at in the diesel risk reduction plan is to look
5 at doing everything possible as quickly as possible to
6 address the oldest vehicles, along with cleaning up, of
7 course, newer vehicles also. But that's one key focus
8 that we have. And that's why we've joined with the
9 comments of the Natural Resources Defense Council, Union
10 of Concerned Scientists, Coalition for Clean Air and other
11 groups suggesting that there's more we can do to address
12 these older vehicles, to accelerate cleanup dates for the
13 '87 and older vehicles, to tighten up the control
14 requirements so that they cannot use the weaker Level 2
15 controls. And we would hope you consider those comments
16 very seriously.
17 As has been mentioned, you have done some
18 analyses of these recommendations and found they are cost
19 effective, that they would result in reducing even more
20 diesel pollution without adding substantial cost to the
21 regulation. So we believe you should move forward with
22 some strengthening changes. We also, of course, committed
23 to look at what more can be done to reduce NOx emissions
24 and that would, of course, need to be at a later date in
25 terms of revisiting another regulation to deal with NOx.
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1 Finally, I want to say that it's not surprising
2 that when the Board is venturing out the adopt a rule that
3 will affect a whole new sector that there are going to be
4 some -- many questions and concerns and fears being
5 raised, as you're hearing today. And we just want to urge
6 you to forge ahead as you have so many times in the past.
7 The technologies are proven. The staff has done a good
8 job in trying to address as many of the concerns as
9 possible, providing flexibility where it's reasonable.
10 You're talking about your willingness to support efforts
11 of haulers to achieve cost recovery by conducting
12 additional outreach and workshops and assisting them any
13 way we can.
14 I think you're doing everything possible you can
15 to make this a workable regulation, and now you just need
16 to move forward and adopt the rules. Your charge is, of
17 course, to cleanup the air, reduce diesel pollution, and
18 this is an essential step forward, and we fully support
19 you in moving ahead.
20 CHAIRPERSON LLOYD: Thank you very much, Bonnie.
21 And again, maybe you can pass on to Todd since you're
22 pretty well -- most of our Board meets in Sacramento, that
23 we actually are doing stuff and we have stuff in the last
24 five years to cleanup the air and maybe we should let Todd
25 know that.
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1 A question from staff. Is it possible -- I
2 didn't think it was possible on some of the older engines
3 to put on Level 3 traps.
4 EXECUTIVE OFFICER WITHERSPOON: It's not
5 possible. So the effect of denying Level 2 means that you
6 force them to reengine or retirement.
7 And what we've done is Level 1, 25 percent
8 control is not good enough. These are gross emitters. We
9 have to do better. Level 2 is not yet certified, but
10 we're hopeful that some strategies may emerge, most likely
11 emulsified diesel fuel in combination with an oxidation
12 catalyst would be certified for this application. That
13 would be 50 percent control, and we want to keep that
14 opportunity on the table in the event that the
15 verification comes through and that the owners have that
16 choice. If we take that away, there is no Level 3. There
17 will not be traps certified for these old vehicles. The
18 only thing left is a new engine and an old chassis or a
19 new vehicle all together.
20 MS. HOLMES-GEN: Can I comment, we don't think
21 the 50 percent is really adequate for those oldest
22 vehicles that are virtually uncontrolled.
23 CHAIRPERSON LLOYD: Thank you. Tom Addison
24 Patricia Monahan, Diane Bailey.
25 MR. ADDISON: Good afternoon, Dr. Lloyd and
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1 members. I'm Tom Addison with the Bay Area Air Quality
2 Management Districts. I'm here today to speak in strong
3 support of this regulation. For the formal record, we
4 submitted written comments, and I trust that you have
5 those.
6 I'd like to begin actually by agreeing with
7 Mr. Mandel of the Engine Manufacturers Association on one
8 critical point. We also appreciate the abilities of your
9 legal counsel. But really that's not why I'm here.
10 SUPERVISOR DeSAULNIER: Obviously, Tom. If we
11 didn't, we wouldn't have given her the job.
12 MR. ADDISON: So reducing public exposure to
13 diesel particulate really is a critical goal. From our
14 perspective, that's one of our most important mutual
15 goals. We think this regulation is key in helping that
16 happen, really because of where these vehicles are. This
17 really held well on the transit bus rule. That really is
18 largely where our support is coming from. In dense urban
19 areas, like the Bay Area, you know, that's an especially
20 important issue.
21 We think that is a fleet sector that really lends
22 itself to cleanup well. To date we've put $9.3 million of
23 our money, of local -- not state money or Moyer money, but
24 our money into cleaning these vehicles up. We really see
25 this as being an area that is right for reduction.
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1 Essentially, though, the problem that we sort of
2 see is that we'll never have enough incentives to cleanup
3 all these vehicles. So it really is time to move from
4 fishing with bait, which is what we've been doing, to
5 fishing with nets. So the regulatory approach now we
6 think is the right one, and we think the proposal before
7 us is both flexible, it's fair. The reliance on BACT and
8 how BACT is defined is a strategy that we support
9 completely.
10 In an ideal world, the one thing that we would
11 love to see would be moving ahead a little bit faster on
12 the pre-'88 vehicles. We've done a lot of them in the Bay
13 Area because we've gone after some of the vehicles that
14 lend themselves well to cleanup. In an ideal world, we'd
15 love to see a little bit faster action on those, but I
16 think there are some legitimate reasons why, you know,
17 you've come up with the rule that you did today that
18 you've got in front of you.
19 I just close by reiterating our support for this
20 rule and by pledging to do what we can to work together to
21 continue to reduce public exposure to diesel particulate
22 before more rules come before you.
23 CHAIRPERSON LLOYD: Thanks, Tom. Appreciate it.
24 Patricia Monahan, Diane Bailey, Bob Lucas.
25 MS. MONAHAN: I wish I was saying good morning
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1 and not good afternoon. My name is Patricia Monahan. I'm
2 a senior analyst with the Union of Concerned Scientists.
3 I'd like to say from the start if you see a tear in my eye
4 or if my voice starts to get a frog in it, it's just
5 because I'm having an allergy attack. I'm not actually
6 trying to persuade you with overly emotive signs.
7 CHAIRPERSON LLOYD: And Kathleen is only going to
8 the Bay Area so --
9 MS. MONAHAN: Well, in my three minutes I'd like
10 first to step back a moment and talk about the genesis of
11 this rule, which is diesel risk reduction plan -- the risk
12 reduction plan was published in 2000. It anticipated that
13 this rule would have actually been published last year.
14 And given that the rule development began in 2001, you
15 would think that would be a reasonable time frame.
16 I think ARB has done a good job of really
17 workshopping this issue to death. I mean, there's been
18 eight workshops -- at least eight workshops. I attended
19 the first one in the summer of 2001. I think staff has
20 tried to accommodate a lot of diverse interests in this.
21 But the reason why we're all working for this rule is
22 because of the tremendous health impacts, not just of this
23 rule, but of all the other ones that are comprising the
24 diesel risk reduction plan. There are just the start.
25 There are many more to come. And I think if we start this
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1 rule by setting a precedent of, you know, having weak time
2 frames, allowing for a lot of exemptions and loopholes,
3 then we don't just impact this rule but we impact all the
4 ones to come.
5 One of the reasons I think staff chose this is
6 because refuse haulers operate in communities. They go
7 through our neighborhoods. Day to day they're exposing
8 children, mothers, families. So I think it's very
9 important that we set a precedent right from the start
10 that we recognize there are going to be costs for
11 implementing these rules, but that the tremendous public
12 health benefits far outweigh the costs. And that has to
13 be the root of our actions.
14 The diesel risk reduction plan proposed to get
15 280 tons per day. This rule would get a little over one
16 ton per day reduction in 2010. Again, it's not a
17 significant part, but it's an important precedent we're
18 setting here.
19 Compared to earlier drafts of the rule, the rule
20 has been weakened over time. The earlier drafts contain
21 some NOx controls and now are not present in the rule.
22 You're heard from other environmentalists. We would like
23 to see some find of future commitment to have the ARB
24 address NOx in the future so we're guaranteed emission
25 reductions from these vehicles.
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1 You've also heard about -- that we would ask for
2 an acceleration of the time frame. ARB's own staff report
3 indicated that moving forward the implementation time for
4 these oldest vehicles is cost effective. It will cut PM
5 reduction costs from $54 per pound to $50 per pound. And
6 it adds 66 cents per household.
7 Finally, we'd like to see stronger controls for
8 the dirtiest engines, these pre-'88 engines that did not
9 have to meet any emission standards. Emission standards
10 started in 1988. And the level of these -- the level of
11 emissions from these engines is at least ten times more
12 than 1994. It's at least ten times. We see a degradation
13 over time with PM from engine exhaust.
14 In conclusion, I'd like to say that we believe
15 the time is ripe to move forward. This is about public
16 health. This is about cost effectiveness. This is a rule
17 that has been workshopped over and over again and an
18 opportunity for California to really take an important
19 step forward in implementing our diesel risk reduction
20 plan. Thank you for the opportunity to speak.
21 CHAIRPERSON LLOYD: Thank you, Patricia. Again,
22 obviously we're committed to the same goal as you are.
23 We're a little bit disappointed that we've not been able
24 to move as fast as we can for the reasons staff said. But
25 trying to work through all the technical issues. We have
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1 to be cautious there, otherwise we may be doing something
2 we don't want to. Getting that balance, and also as we
3 seeing here, trying to get the balance with the different
4 properties, that's very important because as you say, it's
5 important technically to get underway. But it's also
6 important that we also treat the affected parties fairly
7 as well. And we've taken a little bit more time, but we
8 hope it will be a more effective rule.
9 MS. MONAHAN: We appreciate that.
10 CHAIRPERSON LLOYD: Diane Bailey, Bob Lucas, and
11 then lastly, Wendel Smith.
12 MS. BAILEY: Good afternoon, Chairman Lloyd,
13 members of the Board and staff. My name is Diane Bailey.
14 I'm a scientist with the Natural Resources Defense
15 Council. And we have no waste haulers. We don't have a
16 fleet. But we're here today because we care a lot about
17 clean air and public health. So thank you for the
18 opportunity to comment. And I'll keep my remarks brief.
19 We strongly urge your support on this rule, and
20 we'd like to see it strengthened today in several ways
21 that you've already heard. So I'll just summarize for you
22 again. First, it's imperative the oldest vehicles be
23 addressed beginning in 2005, two years earlier than 2007.
24 We also urge that Level 2 controls, which only reduce
25 particulate matter by 50 percent, not be allowed for use
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1 on these oldest vehicles that are pre-1988, as Level 1
2 controls are currently not allowed in the present
3 language.
4 And finally we also urge you to come back and
5 regulate NOx for the same vehicles in the future. It's
6 extremely important to cleanup the oldest and most
7 polluting vehicles as soon as possible. Statewide less
8 than one-fifth of solid waste collection vehicles are
9 these old pre-1988, yet they account for the majority of
10 the pollution from the entire fleet.
11 To illustrate how dirty these vehicles are, we
12 ran modeling shifting the implementation of these vehicles
13 up just two years showed that that would reduce PM by
14 350,000 pounds per year. This is significant. In
15 addition, this would only raise costs by 6 cents per
16 household for a total of 61 cents per household annually
17 for the whole rule. And this is less than the tip that I
18 left for my coffee this morning. We would argue this is
19 truly insignificant. And again, this rule -- the changes
20 that we're asking for for this rule would actually improve
21 the cost effectiveness.
22 Furthermore, it's important to make sure that
23 when the oldest vehicles comply with this rule, they are
24 truly being cleaned up. Because the oldest vehicles never
25 had to meet emission standards, we don't know exactly how
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1 much they pollute. But EPA estimates it's ten times more
2 than comparable vehicles that are middle-aged in the same
3 fleet. Therefore, we believe that Level 2 controls, the
4 ones that reduce by only 50 percent are inappropriate for
5 these oldest vehicles.
6 You've heard from many waste haulers today that
7 they agree that cleaning the air is really important.
8 Yet, for some reason many seem unwilling to be a part of
9 the solution, while we believe that every business and
10 every sector has to be a part of cleaning up the air.
11 And in conclusion, we urge you today to adopt a
12 strong rule making the cleanup of the oldest most
13 polluting vehicles a priority and the cleanup of the
14 oldest -- and setting a standard for future retrofit rules
15 to address these polluter vehicles first.
16 Finally, on another note, we really appreciate
17 the Board's attention in visiting and considering
18 pollution from container ports and dairies. Thank you.
19 CHAIRPERSON LLOYD: Thank you. Bob Lucas. He
20 was are earlier. I guess he's gone. And Wendel Smith.
21 MR. SMITH: If I had seen the sign-up sheet, I
22 would have signed up first rather than last. I'm Wendel
23 Smith. I serve on the Metropolitan Air Quality and
24 Transportation Committee. I'm the incoming President of
25 the El Dorado County Chamber. And I am working as a
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1 consultant to a company called Global Fuel.
2 We had a test unit that we know will increase
3 mileage. We've had it tested on diesels for several
4 years. We're a little short in cash, so we're looking for
5 a partner to do some subsidized testing because we know
6 this unit will get 15 percent increase in mileage that can
7 offset some of the cost. And so with it, we ask for two
8 things to be considered; one, a fast track approach to
9 testing; secondly, potentially to identify some testing
10 partners. And if there's any funds out there in any way
11 that we can have a controlled test be involved because we
12 know we're taking it with all the gas fueled engines.
13 We're making dramatic improvements. So the thought is to
14 get a subsidized testing program so the other technologies
15 out there would have an opportunity to move forward in
16 accelerated testing. Thank you so much.
17 CHAIRPERSON LLOYD: Thank you very much.
18 With that, that comes to the end of the public
19 testimony.
20 Do the staff have any additional comments to make
21 at this time before we --
22 EXECUTIVE OFFICER WITHERSPOON: No. I'll just
23 wait for questions from you.
24 CHAIRPERSON LLOYD: I will now close the record
25 on this agenda item. However, the record will be reopened
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1 when the 15-day notice of public availability is issued.
2 Written or oral comments received after this hearing date
3 but before the 15-day notice is issued will not be
4 accepted as part of the official record on the agenda
5 item. When the record is reopened for a 15-day comment
6 period, the public may submit written comments on the
7 proposed changes which will be considered and responded to
8 in the final statement of reasons for the regulation.
9 So with that, I will throw it open to my
10 colleagues to begin discussion and then we'll get into
11 some ex partes.
12 Supervisor DeSaulnier.
13 SUPERVISOR DeSAULNIER: Did you want to do ex
14 parte now?
15 CHAIRPERSON LLOYD: No. Let's have a discussion
16 now. They'll get into that before we go --
17 SUPERVISOR DeSAULNIER: Well, first of all, I
18 think staff's done its usual great job. Obviously this
19 took a lot of work. It strikes me that there are four or
20 five things this comes down to just where I believe we
21 could move forward and continue and actually get on with
22 this work that's taken so long.
23 The dual fuel trucks, it seems like, from what
24 you have said, Kathleen, this is an opportunity to work
25 with San Diego and Sacramento to carve those out so we can
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1 take care of that.
2 On what the environmentalists have asked for, I
3 would be supportive of all three of those, although it
4 sounds like two of the issues are doable. That is moving
5 the date up on the pre-'88 trucks from 2007 to 2005 and
6 making some kind of commitment -- maybe you could respond
7 to that -- about future NOx reductions.
8 The one that sounds more problematic is Level 2
9 to Level 3. So I don't know how we could -- my view would
10 be that we would continue to sort of monitor that. If the
11 technology were to change in any way, we encourage that.
12 I'm sure we're supportive of trying to do that. But with
13 what you have explained, it's pretty difficult to get
14 there. So maybe you can respond to that when I get
15 through with the last couple.
16 I'm really concerned about the smaller haulers.
17 In my experience in local government -- you know, not
18 unlike other corporate entities and retail business, the
19 smaller haulers in the state of California have been
20 unduly punished because of the global marketplace and
21 national marketplace. It's not there's anything
22 inherently evil or wrong with large companies, but I've
23 seen lots of small companies in my experience in the Bay
24 Area, particularly in Contra Costa County where they were
25 eliminated. And to large degree they were lowballed out
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1 of business.
2 They all turned -- all the haulers turned out all
3 right because they sold their interest and did quite well.
4 But the result for the rate payer and for local government
5 was you had a lot of short-term savings, but that changed
6 very quickly because in other retail instances when the
7 competition went away, and particularly the small
8 competitors, then the pressure came back on local
9 government to raise the rates.
10 I understand the balance here of not somehow us
11 becoming a party to either incentivizing local government
12 or haulers to pass the cost to the rate payer. I don't
13 want to be a party to that. But on the other hand, I want
14 to encourage local government to do the right thing and
15 pass this through.
16 And I know that those of us who have held local
17 office are sensitive to this. We're the ones that will
18 get blamed for raising the rates on trash collection. For
19 me at least, this is an inexpensive thing to do given the
20 public health benefits. But we have to help our
21 colleagues in local government to see that and be able to
22 express it in the same form or fashion. And from that
23 perspective I would, as I said earlier, along with D.D.,
24 I'd be more interested in stronger language rather than
25 the current language.
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1 I think the idea of workshops and education, that
2 would be really helpful particularly in partnership with
3 some of the haulers and the Integrated Waste Management
4 Board.
5 So for me, I think that's about it. Just again,
6 I think staff has done a great job. I know, Alan, you've
7 been very involved. And I think we're right on the cusp
8 of doing something really good. I think most of these
9 things, as someone said -- it might have been Bonnie --
10 once we go through this, I think most of the haulers will
11 be pleased with what's happened. But I think we do need
12 to partner with them to get the message out to local
13 government that we need to help them recover the costs.
14 Thank you, Mr. Chairman.
15 CHAIRPERSON LLOYD: Just follow up so I don't --
16 I agree with you on both the first two points, Mark --
17 actually all the points you made -- about trying to
18 accelerate for the older vehicles. Clearly it's
19 increasing hazard there. And the more we can reduce that
20 faster for the older engines, the better off we're going
21 to be.
22 The other issue as staff knows, I've been
23 constantly pushing on trying to get whatever NOx we can
24 along with the particulate. Because as we've heard for
25 the Sacramento area -- and they've been hitting us hard on
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1 that in the South Coast. So wherever we can, we need to
2 capture both NOx along with the particulates because
3 obviously NOx is a precursor to particulate, as well as a
4 precursor to ozone, as well as a precursor to some of the
5 nitro Ph's.
6 So for all those reasons -- but I understand. So
7 I hope that staff will continue to make that push and
8 whatever possible to try to get some co-commitment for NOx
9 and PM. And I also thoroughly agree with you, although I
10 think you're more knowledgeable in that, and I think D.D.
11 is going to express that as well and my colleagues here,
12 the concern that we look at some of these smaller
13 properties and are recognizing some of the difficulty they
14 have, because clearly we want to respect them. We want to
15 clean up the air. But we don't want to, as you say, put
16 some of these properties out of business, where then you
17 end up with large monopolies which in the longer term may
18 not be as effective with us.
19 Ms. D'Adamo.
20 BOARD MEMBER D'ADAMO: Yes. In the interest of
21 time, I'm just going to concur with what you just said,
22 Mr. Chairman, and Mark here as well.
23 On the issue of the smaller operators, my concern
24 mainly has to do with the acceleration. I just want to
25 clarify that. I'd be supportive of looking into anything
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1 that we can do sooner. But the concern that I have on the
2 smaller operators is, not only is it rough on them, but
3 also any possible unintended consequences if we end up
4 with some of these larger companies coming and taking
5 over. I'm just looking at the situation in the valley
6 where they are mostly run by smaller operators with the
7 larger operators from, say, the Bay Area come in and would
8 they be hauling perhaps waste into the valley and
9 creating, you know, some unintended environmental
10 consequences.
11 So that has to do with -- that's my main concern
12 with wanting to make sure that if we do have an
13 accelerated program, that we have, you know, some way --
14 and we're asking how many trucks these operators have.
15 And it seemed like a range from anywhere from 10 to 50
16 trucks. And then when the last two companies came in,
17 1500 trucks 500, you could add up all these small
18 operators that were here today wouldn't even come close.
19 So anything we can do on that.
20 And also I think we should do what we can to push
21 with the NOx reductions. I think that cuing this issue
22 up, especially for where we're going to be next month in
23 South Coast is particularly important.
24 CHAIRPERSON LLOYD: I think on the -- you know,
25 maybe we look at two-tier system here because you say --
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1 and again, I assume that as staff looks at it, they will
2 do the usual good job of looking at the impact. But for
3 example, on the refinery side, we look at some exemptions
4 or delayed implementation to smaller refiners. Maybe
5 staff could look at whether that could be implemented
6 here.
7 EXECUTIVE OFFICER WITHERSPOON: I'm sorry,
8 Chairman Lloyd. We were talking about some of the things
9 you were already discussing. Can you repeat the last part
10 about the small refiner --
11 CHAIRPERSON LLOYD: All I was saying, I assume
12 staff is going to do its usual good job at looking at
13 impacts. And you've heard from us that we're all
14 concerned that we want to push ahead as rapidly as
15 possible to get the older vehicles off the road, but we
16 also want to make sure that we're not unfairly impacting
17 some of these smaller properties. In that case, can we
18 look at some of the larger properties maybe having an
19 accelerated schedule. And then before we impose on some
20 of the smaller ones, to look at some of the economic
21 impacts.
22 EXECUTIVE OFFICER WITHERSPOON: Have you thought
23 about what line you would draw between small and large
24 properties? Are you looking for a suggestion from us?
25 Because I was hoping it would emerge from the testimony,
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1 and it didn't break out. They were all --
2 CHAIRPERSON LLOYD: I was hoping so too.
3 EXECUTIVE OFFICER WITHERSPOON: They were
4 relatively big, what we would think of as big. Even 50 is
5 pretty big. And for example, in the South Coast with
6 their rule, they have a threshold of 15 for who's in who's
7 out, and that would give very little relief on an
8 accelerated schedule.
9 We do believe that the older vehicles are
10 concentrated in the smaller fleets with pull ahead causes.
11 The only vehicles could be changed out faster. It means
12 that the small guys will have to go seek the capital,
13 negotiate the rates, and be very successful because their
14 direct costs will be higher on average than what was
15 presented to you as, you know, for everyone will be. But
16 the kinds of rate changes that they will need will be more
17 than that.
18 CHAIRPERSON LLOYD: I think Supervisor DeSaulnier
19 maybe had a question.
20 SUPERVISOR DeSAULNIER: Maybe, D.D., what I
21 was -- what I felt from the testimony is that if we can
22 help all of the haulers recover the cost, then we can
23 accelerate it. And maybe there's a way -- and you
24 expressed it a little bit differently. I agreed with you
25 to begin with. But if we can recover the cost and it's
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1 just intuitively -- even though I think someone from Waste
2 Management said it wasn't true. Intuitively it strikes me
3 the small ones are the ones that are going to have the
4 most trouble articulating the need for rate increases and
5 the revenue stream. So I was more interested in helping
6 them all, but particularly focusing on the small ones.
7 And maybe there's an option if they really are having
8 trouble, we give them some kind of period for an exemption
9 like -- pardon the expression -- a hybrid of what you
10 suggested. That's not in the gold category, I know but --
11 BOARD MEMBER RIORDAN: It is, I think, a
12 difficult -- staff's going to have to work on this because
13 there's going to be a whole host of items that affect a
14 smaller, you know, business. Some of them are going to
15 have the older trucks, as Ms. Witherspoon just pointed
16 out. If you require replacement of the older trucks,
17 that's going to be an immediate need for cash flow. And
18 you provide then the rates to be up and that's going to
19 affect fewer people.
20 I think there are some times that we just are
21 going to have to look at this on a case by case basis and
22 try to help. If our intent is to help some of the smaller
23 companies, you're just going to have to have the wisdom
24 of -- I don't know whom, but someone to figure out how to
25 do it without unintended consequences. And good luck on
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1 that.
2 Otherwise, I think it's very commendable what
3 you've all worked out. And I think that if we can do the
4 outreach -- and I'm just going to hope that we get on that
5 very quickly, so that we can explain to the city councils
6 and the Board of Supervisors the tremendous health
7 advantages that accrue to this particular item. I think
8 we can be successful, but we need to start right away.
9 CHAIRPERSON LLOYD: Professor Friedman.
10 BOARD MEMBER HUGH FRIEDMAN: Well, first, I, too,
11 want to applaud the staff for a very thoughtful balanced
12 solution or proposal for very a complicated, challenging
13 issue.
14 And I picked up on one concern, that is that -- I
15 think you've raised it, but we haven't directly addressed
16 it in our discussions here. And that is the issue of
17 reliability or dependability, certainly. And my sense is
18 that there is the best available proven technology,
19 certainly in Europe and other places. And it's really the
20 application to a specific engine that's the issue or the
21 concern. And I guess's that's education. That's
22 experience, for particularly for smaller haulers or
23 operators. And there may be the need for some individual
24 exemptions and so forth. There may not be technology
25 available to retrofit, as we've seen, with the older
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1 engines. And so with these time lines, unless you're just
2 operating three or fewer, you're going to have an
3 automatic deferral of reckoning day. We may be faced with
4 the cost of replacement.
5 In any event, I think with the periodic reviews
6 that we built in -- I see that the latest version of the
7 15-day notice now does have an annual review until
8 sometime much later when it kicks in to biennial. And so
9 I think that it's about as good as we can do. It may not
10 be perfect, but we haven't achieved perfection very often.
11 And as I like to think, it's good enough for jazz. I
12 commend you for your effort.
13 CHAIRPERSON LLOYD: Mr. Calhoun.
14 BOARD MEMBER CALHOUN: One comment, I'll admit we
15 heard today in testimony was cost, cost, cost. And
16 anything that we can do to help out in that regard, I
17 would certainly like to encourage us to do so.
18 The next item, I guess I'd like to remind the
19 staff and the Board that this Board has had one
20 unfortunate experience with the retrofit program I happen
21 to be very aware of. I would just encourage us to really
22 stay on top of things. And if there's a problem, we need
23 to try to correct it as soon as possible.
24 CHAIRPERSON LLOYD: I think that's a good
25 reminder, Joe. But also I think all of us want to get to
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1 the situation whereby we can take advantage of some of the
2 tremendous advances being made with the new engines. And
3 so we don't run the same risk that we're doing now and
4 work our way through that. And I think all of us are
5 committed to try to do that. It's a good reminder.
6 SUPERVISOR PATRICK: Thank you, Mr. Chairman.
7 I, too, would like to say how very much I support
8 this and how much I support or I appreciate the good work
9 that staff has done.
10 I think it's safe to say that we have a lot of
11 really nervous people in the audience and understandably
12 so. Because, you know, you're concerned about cost
13 recovery and about reliability, and I think that you have
14 every right to be. So I think that, you know, we need to
15 begin immediately starting a dialogue. And we have a
16 representative from the League of Cities, someone from
17 CSAC can be brought on board to begin immediately to be
18 working with the folks that are going to -- are
19 representing the taxpayers and the folks with whom our
20 disposal companies negotiate so that these costs can be
21 recovered, because I think it's important that they be
22 recovered. I think when we emphasize how important this
23 is to public health, I think that will certainly help us.
24 I, too, share concerns about some of our smaller
25 disposal companies. And my concern about accelerating the
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1 pre-1988 conversions is that many of those small
2 companies, those are the trucks that those folks are going
3 to have. And also those folks may be serving some
4 communities that are economically challenged as well. So
5 I think it's incumbent upon staff to work closely with
6 them and to bring our elected officials on board as
7 quickly as we can to make them understand that this is an
8 important move toward public health, and it's something
9 that is very necessary and to continue the dialogue with
10 all the stakeholders here today. Some are happy. I don't
11 think anybody's really happy -- but some relative degrees
12 of happiness. But I think the most important thing is
13 that we try to address some really beneficial comments
14 that were made today, and that we move forward with it.
15 But I think as controversial as this has been for
16 probably a year and a half, I would say that today all of
17 the folks who talked to us were very -- gave very
18 passionate feelings about this whole process. And I think
19 that they all felt they had been listened to. They may
20 not be happy with the end result, but I know there are
21 folks who worked really hard on this. So my compliments
22 to staff and all the people who worked on it. And I don't
23 know that the work is over. I think it's just begun. I
24 know that staff is up to that task.
25 CHAIRPERSON LLOYD: And I think as we were
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1 reminded earlier, I think the industry is really committed
2 to working here. We all live and breathe the same air. I
3 think there's a strong commitment to move ahead.
4 With that, I'd like to call upon my colleagues
5 starting with Supervisor Patrick to identify any ex parte
6 communications.
7 While we may communicate off the record with
8 outside persons regarding rule making, we must disclose
9 the names of our contacts and the nature of the contents
10 on the record. This requirement is specifically to
11 communications which take place after notice the Board
12 hearing has been published.
13 And Supervisor Patrick, anything?
14 SUPERVISOR PATRICK: No.
15 CHAIRPERSON LLOYD: Mr. Calhoun.
16 BOARD MEMBER CALHOUN: On the 15th of July I met
17 with two representatives from the Rainbow Disposal
18 Company, Jerry Maffet and Mike Rumble. And during the
19 brief session that we had, we had discussed costs. And
20 nothing I heard from them was different from what I heard
21 today.
22 BOARD MEMBER RIORDAN: I have none.
23 CHAIRPERSON LLOYD: On September the 19th I had a
24 conference call with Todd Campbell, Coalition for Clean
25 Air; Bonnie Holmes-Gen, American Lung Association; with
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1 Diane Bailey and Gail Rudemenfer of NRDC; and Patricia
2 Monahan, Union of Concerned Scientists.
3 BOARD MEMBER HUGH FRIEDMAN: On July 23rd I had a
4 brief meeting with Gene Erbin with the firm Nielsen,
5 Merksamer here in Sacramento and his client, Kent Stoddard
6 of Waste Management. They basically indicated that they
7 had some concerns that were discussed here today by them,
8 but they were generally supportive.
9 BOARD MEMBER WILLIAM FRIEDMAN: I have nothing.
10 BOARD MEMBER D'ADAMO: On Tuesday, September
11 23rd, I participated in a conference call with Todd
12 Campbell, Coalition for Clean Air; Bonnie Holmes-Gen,
13 American Lung Association; Diane Bailey, NRDC; Patricia
14 Monahan, Union for Concerned Scientists; and Don Anair,
15 Union of Concerned Scientists.
16 On Wednesday, September 24th, I met in my Modesto
17 office with Alan Marchant, Turlock Scavenger; and Sean
18 Edgar; California Refuse Removal Council. And the
19 discussions mirror their testimony today.
20 SUPERVISOR DeSAULNIER: Mr. Chair, I met on
21 August 25th in my office in Concord with Sean Edgar from
22 the California Refuse Removal Council; and Sheryl
23 Granzella from the Richmond Sanitary Services. And the
24 discussion was consistent with their testimony today.
25 CHAIRPERSON LLOYD: With that, I'd like to read
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1 in the resolution and be willing to entertain a motion.
2 SUPERVISOR DeSAULNIER: I'd be happy to attempt a
3 motion.
4 CHAIRPERSON LLOYD: Okay.
5 SUPERVISOR DeSAULNIER: I move the Board adopt
6 Resolution 03-24, and then incorporate in our motion the
7 issue that Todd Stoddard brought up about -- and ask staff
8 to -- in regards to pass-through cost to work with all
9 affected stakeholders as Mr. Stoddard suggested, including
10 the Integrated Waste Management Board and others, to
11 develop an outreach program to help the haulers,
12 particularly the smaller ones, be able to recover their
13 costs and work with CSAC and the League of Cities. And
14 then also as part of the motion is to move the start-up
15 date from 2007 to 2005 on pre-'88s, and then reiterate one
16 more time our long-term commitment for further NOx
17 reductions.
18 CHAIRPERSON LLOYD: You were perfect on
19 everything besides the number. I think it's 03-21.
20 SUPERVISOR DeSAULNIER: Okay. We've had so many
21 of these come up here. I'll move whatever the last one
22 was.
23 CHAIRPERSON LLOYD: And I would -- do we have a
24 seconder?
25 BOARD MEMBER D'ADAMO: I have a question.
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1 CHAIRPERSON LLOYD: Professor is going to second,
2 but D.D. has a question.
3 BOARD MEMBER D'ADAMO: I have a question about
4 where we ended up. I'd be supportive of that, but I need
5 some clarification of where we ended up on the small
6 companies. Are we going to leave that up to staff to come
7 up with perhaps a number and a waiver? Because as I read
8 through the proposal -- I know it's changed quite a bit,
9 but as I read through the document, I don't see that there
10 is an extension based upon cost. It's only based upon
11 whether or not the technology is available.
12 EXECUTIVE OFFICER WITHERSPOON: That's correct.
13 There is no forgiveness for cost, for hardship, or
14 anything of the kind. I'm glad you pointed that out.
15 And earlier I asked did the Board have a
16 threshold in mind as you were casting about, is the
17 pull-ahead for everybody or just the bigger companies?
18 And Supervisor DeSaulnier answered back, "Well, if we are
19 able to solve the rate problem, then everyone can play."
20 Since you're bringing it up again, Tom and I have
21 been having a sidebar down here that we'd like the
22 opportunity to consider and maybe solicit some comment
23 about a threshold. We're still toying with the 15-vehicle
24 as taking the littlest of the littles out, or giving them
25 more time is basically what it would do. They wouldn't
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1 have to pull-ahead as fast, and they'd have more access to
2 exemptions perhaps than the biggers.
3 And also concentrate staff's own efforts as we go
4 out and do this outreach and working with individual
5 communities and selling the program, we're not torn in
6 every direction at once. Because we have some concern
7 about our ability to deliver.
8 SUPERVISOR DeSAULNIER: I'd be fine to consider
9 something like that as an amendment to the motion. My
10 interest was giving it a shot first to see if you can
11 recover it, but be sensitive. What Barbara said, a lot of
12 these haulers may be in communities that don't have the
13 ability to recover cost just in terms of paying it through
14 the rate payer.
15 BOARD MEMBER RIORDAN: Exactly. You're going to
16 have some -- if you move it too fast, you're going to have
17 unintended consequences that I think we need to be
18 sensitive to. And it seems to me 15 would be the
19 reasonable number.
20 SUPERVISOR DeSAULNIER: I think that's good.
21 CHAIRPERSON LLOYD: I think we're putting quite a
22 burden on staff here. But that's good and bad. It gives
23 you some flexibility because I think you'll come up with
24 better data than we have. I think you can read the
25 sentiment of the Board.
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1 EXECUTIVE OFFICER WITHERSPOON: Just to be clear,
2 the way we'll fix it is through finding that magic
3 threshold and figuring out the right timetable for the
4 littles, as opposed to constructing a hardship exemption
5 which would just blow a hole in the side of the
6 regulation.
7 BOARD MEMBER WILLIAM FRIEDMAN: Just a question.
8 Did we not, with respect to the issue of negotiations
9 between haulers and municipalities, include some provision
10 so that we could hear back?
11 SUPERVISOR DeSAULNIER: Yes.
12 CHAIRPERSON LLOYD: Yes.
13 BOARD MEMBER WILLIAM FRIEDMAN: Perhaps that can
14 be included.
15 CHAIRPERSON LLOYD: And also to provide some cost
16 data to some of the municipalities there. And also,
17 please, when we have the meeting that was suggested by
18 Kent, make sure that the Trucking Association is
19 represented.
20 SUPERVISOR DeSAULNIER: Given that I was almost
21 perfect, I was fine with all those comments and
22 corrections.
23 CHAIRPERSON LLOYD: So with that, we have a
24 seconder. And so all in favor say aye.
25 (Ayes)
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1 CHAIRPERSON LLOYD: Any against?
2 Thank you very much.
3 And again, thank you, staff, for a great job in
4 bringing this together. Unfortunately, the work isn't
5 finished. But thank you very much indeed.
6 With that, we will take a break until 3:00 when
7 we'll start the item on the small off-road engines.
8 (Thereupon a recess was taken.)
9 CHAIRPERSON LLOYD: Thank you. After that
10 10-minute break we move on to the next agenda item,
11 03-7-3, proposed exhaust and evaporative standards for
12 small off-road engines.
13 Staff has been working on this regulatory
14 proposal for several years and is now ready for our
15 consideration. I've witnessed firsthand the incredible
16 number of staff hours devoted to this task; the extensive
17 negotiations that have gone on with the affected industry
18 groups; and, most recently, the strenuous efforts
19 undertaken by staff, California's two senators, the
20 Governor's Washington DC office, environmental groups, and
21 our air quality colleagues throughout the nation to defend
22 states' rights to proceed with these essential emission
23 control measures.
24 I wish I could report that the latter issue was
25 resolved at this time. Unfortunately, it is not. And, in
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1 fact, that's why we had the slight delay because we're
2 still getting communications coming in on this issue.
3 But what is absolutely clear in my mind is that
4 the small off-road engine regulation is one of the most
5 thoroughly analyzed and most carefully constructed rules
6 our staff has worked on for some time. It is not
7 half-baked, it is not premature, and my colleagues on the
8 Board should be confident that staff understands this
9 source category quite well.
10 And I remember several months ago I was asked to
11 take a look at what staff was doing on this issue to make
12 sure that there was communication between the industry and
13 staff. And, again, I can attest that maybe there was some
14 lack of interest on industry, or at least maybe not taking
15 this too seriously, but since that time I feel that staff
16 has been fully engaged. We've had many proposals. We've
17 worked -- the staff was worked especially with many pieces
18 of the industry. And, again, today while we clearly don't
19 have everybody on board, I'm convinced that those people
20 who are interested in really cleaning up the air have
21 worked with us very carefully and that we are ready to
22 hear this item.
23 Next month the Board will consider a revision to
24 the State Implementation Plan for the South Coast Air
25 basin. That plan contains several regulatory commitments
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1 for this Board's consideration. And we already are
2 receiving letters that should contain even more. Two of
3 the commitments in the proposed South Coast plan relate to
4 reducing emissions from small off-road engines. If the
5 Board approves the proposed SORE rule today, we would be
6 fulfilling both of those SIP commitments.
7 And so this is an important rule, it's an
8 important challenge as we look ahead, as I mentioned, to
9 next month the challenge we have in the South Coast basin.
10 We need every pound of pollution that we can get from
11 every category that we can get.
12 And, again, I continue in the tradition of
13 looking at making sure we can get the technology that's
14 proven elsewhere into various categories is very, very
15 important.
16 So, Ms. Witherspoon, would you please begin the
17 staff presentation on this important item.
18 EXECUTIVE OFFICER WITHERSPOON: Thank you,
19 Chairman Lloyd, and members of the Board.
20 Small off-road engines are a major source of
21 emissions in California. Exhaust standards previously
22 adopted by the Board have stopped the growth of tailpipe
23 emissions in this category. However, there are no
24 evaporative emission controls in place today. The
25 proposal you are considering would tighten exhaust
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1 emission standards by one-third and would establish
2 evaporative standards for the first time.
3 As you will hear in the staff presentation, we
4 have continued to work with the major stakeholders right
5 up to the eve of this hearing. As a result of these
6 discussions, staff will be proposing revised exhaust
7 emission standards and two new options to comply with the
8 evaporative emission requirements.
9 The revised proposal reduces costs, addresses
10 engineering challenges related to using a catalytic
11 converter on these small engines, and provides additional
12 compliance flexibility. We believe the staff's revised
13 proposal addresses all the major technical issues raised
14 by industry representatives, while achieving nearly the
15 same emission reductions as the original staff proposal.
16 I'd like to emphasize these changes are fully
17 within the scope of our original notice and can be acted
18 upon by the Board today even though staff is still working
19 on the specific regulatory language to accomplish them,
20 which would be circulated for comment during the routine
21 15-day change process.
22 At this time I'd like to turn the presentation
23 over to David Salardino of our Mobile Source Control
24 Division, who will present staff's recommendation on the
25 exhaust side. Following David's presentation Jim Watson
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1 of our Monitoring and Laboratory Division will discuss the
2 evaporative emission portion of the proposal.
3 (Thereupon an overhead presentation was
4 Presented as follows.)
5 MR. SALARDINO: Thank you, Ms. Witherspoon.
6 Greetings, Chairman Lloyd, members of the
7 Board --
8 CHAIRPERSON LLOYD: Microphone please. It's not
9 on.
10 MR. SALARDINO: Sorry. Thank you.
11 Greetings, Chairman Lloyd, members of the Board,
12 ladies and gentlemen.
13 Today staff is proposing for the Board's approval
14 amendments to the current small off-road engine exhaust
15 emissions regulations as well as new regulations to reduce
16 evaporative emissions from small off-road engines and
17 equipment. This item is a joint effort between staff and
18 the Mobile Source Control Division and the Monitoring and
19 Laboratory Division.
20 --o0o--
21 MR. SALARDINO: In this presentation I'll begin
22 by viewing some of the background information regarding
23 the small off-road engine category. I'll then summarize
24 our proposal to reduce exhaust emissions from small
25 engines, after which I will turn the presentation over to
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1 Mr. Jim Watson of the Monitoring and Laboratory Division
2 to summarize the evaporative emission reduction proposal,
3 the environmental benefits of staff's proposal, as well as
4 the economic impacts.
5 Mr. Watson will then conclude the presentation
6 with a brief summary and a recommendation to the Board.
7 --o0o--
8 MR. SALARDINO: The small off-road engine
9 category consists of engines at or below 19 kilowatts. It
10 includes and consists of both two and four stroke engines,
11 which are used primarily in lawn and garden and small
12 industrial and commercial equipment. By definition, this
13 category does not include equipment that qualifies under
14 the farm and construction equipment preemption that was
15 contained in the 1990 federal --
16 BOARD MEMBER HUGH FRIEDMAN: Excuse me. We're
17 having trouble hearing you. If you wouldn't mind putting
18 that microphone real close to your chin, I'd really
19 appreciate it.
20 MR. SALARDINO: Sorry about that.
21 BOARD MEMBER HUGH FRIEDMAN: Thank you.
22 MR. SALARDINO: California cannot regulate
23 emissions from new farm and construction equipment less
24 than 175 horsepower that would otherwise be in this
25 category.
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1 --o0o--
2 MR. SALARDINO: This shows examples of some the
3 equipment in the small engine powered category. Small
4 engines are typically categorized as handheld and
5 non-handheld.
6 Handheld engines have small engine displacements
7 and are typically used in applications in which the
8 operator supports the equipment, such as a leaf blower or
9 a string trimmer.
10 Non-handheld engines are larger. A majority of
11 the non-handheld category consists of walk-behind mowers.
12 Please note that for the remainder of this
13 presentation you will see a drawing of a string trimmer in
14 the lower lefthand corner and/or a drawing of a lawnmower
15 in the lower righthand corner denoting slides specifically
16 pertaining to this equipment.
17 --o0o--
18 MR. SALARDINO: Small off-road engines were
19 California's first off-road category subject to emission
20 control regulations. In 1990 the Board adopted exhaust
21 emission standards for small engines with implementation
22 dates starting in 1995.
23 Manufacturers were able to meet these standards
24 for the most part by modifying engines to run at a leaner
25 air/fuel ratio and improving engine cooling.
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1 In 1998 the Board amended the small engine
2 regulations to incorporate more stringent exhaust
3 standards and included a requirement that manufacturers
4 show emission compliance over the useful life of the
5 engine. These new durability-based standards were
6 implemented started in 2000.
7 --o0o--
8 MR. SALARDINO: During this time period the U.S.
9 EPA finalized its own exhaust emission reduction
10 requirements for small engines, which are similar to
11 California's program. There currently are no federal or
12 State requirements to control evaporative emissions from
13 small engines. Staff is now returning to the Board to
14 propose requirements to further reduce small engine
15 emissions.
16 --o0o--
17 MR. SALARDINO: The combined exhaust and
18 evaporative emission contribution from small off-road
19 engines is significant, at 152 tons per day in 2000, with
20 evaporative emissions making up about 30 percent of the
21 total.
22 The adopted emission standards will continue to
23 reduce exhaust emissions as older diurnal units get
24 replaced with new cleaner units. However, after 2010 the
25 small engine emissions are expected to increase as the
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1 addition of cleaner engines is offset by population
2 growth.
3 In addition, with no regulatory requirements
4 evaporative emissions will continue to increase with
5 growth and will make up about 40 percent of the total by
6 2020.
7 --o0o--
8 MR. SALARDINO: Next month staff is scheduled to
9 present a new State Implementation Plan that measures --
10 that includes measures to reduce air pollution throughout
11 the state. Today's proposal is designed to meet the
12 emission reduction commitments outlined in two of the
13 measures. Those two measures, Small Off-Road 1 and Small
14 Off-Road 2, count on exhaust and evaporative emission
15 reductions from handheld engines and non-handheld engines
16 respectively.
17 --o0o--
18 MR. SALARDINO: I will now discuss staff's
19 proposal to reduce exhaust emissions from small engines.
20 As I mentioned earlier, the U.S. EPA has
21 promulgated federal emission standards for small engines.
22 EPA's HC+NOx standard for handheld engines gets
23 increasingly more stringent through 2005, reaching a level
24 of 50 grams per kilowatt hour for engines less than 50 cc,
25 which is more stringent than California's current standard
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1 of 72 grams per kilowatt hour.
2 Therefore, staff proposes a third tier standard
3 equivalent to the federal HC+NOx standard for engines less
4 than 50 cc. Implementation would begin with the 2005
5 model year. This would be a 30 percent decrease from the
6 current Tier 2 standards.
7 --o0o--
8 MR. SALARDINO: Technologies already exist which
9 enable manufacturers to meet the proposed Tier 3
10 standards. There are currently 25 engine families
11 certified in California that already meet the Tier 3
12 levels. These certified engine families include all types
13 of handheld equipment.
14 Manufacturers have used a variety of technologies
15 to comply with the handheld standards, such as replacing
16 two-stroke engines with four-stroke engines, addition of a
17 catalyst to a two-stroke engine, advanced stratified
18 scavaging, and two stroke/four stroke hybrids.
19 In addition, zero emission electric equipment is
20 also available.
21 These technologies have allowed manufacturers to
22 comply with the current emission requirements as well as
23 confirm the feasibility of the proposed emission
24 requirements.
25 --o0o--
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1 MR. SALARDINO: Non-handheld engines are
2 separated in to two classes: Engines between 80 and 225
3 cc are classified as Class 1 engines; and engines 225 cc
4 are Class 2 engines.
5 Staff proposes emission standards for these
6 engines that are consistent with reductions achievable
7 with the addition of a catalytic converter. Staff has
8 taken part in meetings within the last few weeks in which
9 manufacturers and manufacturer associations have made
10 counterproposals to staff's original proposal as outlined
11 in the staff report.
12 The industry counterproposals suggest additional
13 flexibility to use compliance and/or reduce the cost of
14 compliance. In response to these discussions, staff is
15 proposing alternative Tier 3 standards for HC+NOx of 10
16 grams per kilowatt hour or engines between 80 and 225 cc
17 and 8 grams per kilowatt hour for engines 225 cc and
18 above. These standards are an alternative to staff's
19 originally proposed standards of 8 and 6 grams per
20 kilowatt hour.
21 Staff's alternative standards will reduce the
22 amount of heat generated from the catalytic converter that
23 must be managed, reduce costs, and eliminate the chance
24 that major engine redesign may be needed for some older
25 engine designs. Tailpipe emissions from these engines
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1 would be reduced by about one-third with the alternative
2 proposed standards.
3 In addition, staff proposes to stagger the
4 implementation date of these standards to allow
5 manufacturers appropriate lead time for engineering and
6 development, while providing the earliest start to
7 achieving the desired emission reductions. Thus for
8 engines between 80 and 225 cc's staff proposes an
9 implementation date of 2007, and 2008 for engines 225 cc
10 and above.
11 As shown in the next few slides these proposed
12 standards were based on test results in which several
13 engines were equipped with catalytic converters.
14 --o0o--
15 MR. SALARDINO: ARB funded a catalyst test
16 program designed to show the technical feasibility of new
17 emission standards based on the use of catalysts on
18 non-handheld engines. Small engine and equipment
19 manufacturers participated with ARB in the test program
20 through monthly meetings and technical assistance.
21 ARB contracted with the Southwest Research
22 Institute to conduct exhaust emission durability testing
23 on six small engines over 80 cc. The objective of the
24 program was to develop six non-handheld engines and
25 low-emission configurations and then age and test the
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1 engines throughout their useful life. The six engines
2 chosen for the program are shown here.
3 These engines all meet the current California
4 Tier 2 emission standards. Four engines are using
5 walk-behind mower applications. One is for a riding
6 mower. And one is used in constant-speed generator
7 applications.
8 These engines were tested when new, i.e., at zero
9 hour, and then tested again after running for hundreds of
10 hours over a service-accumulation cycle.
11 Each engine was equipped with a three-way
12 catalytic converter and a relatively simple air induction
13 system to enhance the catalytic reaction.
14 In addition, for the Briggs & Stratton engine No.
15 1 and for the Kawasaki engine, Southwest adjusted the
16 carburetor to lean out the air/fuel mixture.
17 --o0o--
18 MR. SALARDINO: Here we see three of the engines
19 that Southwest equipped with catalysts. The mufflers
20 shown installed on the engines are the developed mufflers
21 with the catalyst. The original mufflers are shown next
22 to the engines on the left for comparison.
23 As you can see, in some cases the muffler was
24 increased slightly or modified to accommodate the
25 catalyst, as in the case with the Honda No. 2 engine.
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1 However, in many cases, such as the Briggs engine shown,
2 the catalyst was fit into the existing muffler housing.
3 --o0o--
4 MR. SALARDINO: The objective of the test program
5 was to develop small engines in low-emissions
6 configurations, with the ultimate goal of reducing
7 tailpipe HC+NOx emissions by 50 percent or more at the end
8 of the useful life.
9 As shown in this table, each developed engine
10 except for the Briggs & Stratton No. 2 met or exceeded the
11 50 percent target level at each of the test points.
12 --o0o--
13 MR. SALARDINO: This slide shows the emission
14 levels achieved by engines in the Southwest test program
15 as compared to the revised proposed alternative standards.
16 The testing of Southwest was designed to be a
17 proof-concept project which ultimately demonstrated that
18 small engines can be designed to meet the proposed
19 standards over the useful life of the engine. While the
20 proposed emission standards are certainly feasible, some
21 engines may require additional development beyond the work
22 completed at Southwest as evidenced by two of the engines
23 in this program.
24 Manufacturers have raised safety concerns related
25 to increased temperatures resulting from the incorporation
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1 of a catalyst on small engines. Oxidation of HC and CO
2 creates heat, and along with any enleanment of the
3 air/fuel mixture could lead to increased exhaust gas
4 temperatures and catalyst muffler skin temperatures.
5 This temperature slide shows that in some cases
6 the addition of a catalyst resulted in increased muffler
7 skin temperatures. While we believe that in some cases
8 the increase of temperature will be small, on the order of
9 less than 50 degrees Fahrenheit, in other cases it might
10 be significantly higher.
11 Manufacturers will need to address surface
12 temperature issues when developing a catalyst system to
13 meet the proposed standards. But as has been done with
14 many two-stroke engines currently equipped with catalysts,
15 these issues can be adequately addressed in the design of
16 the system by, for instance, improving cooling flow and
17 providing additional shielding of the catalyst.
18 As shown in this slide by the purple bar, the
19 catalyst shield temperature on the Honda engine was almost
20 500 degrees lower than the catalyst surface temperature.
21 Staff is certain that the lawn and garden
22 manufacturers will be able to address temperature concerns
23 by using approaches similar to those developed by other
24 manufacturers who have successfully and safely implemented
25 catalyst technology over the last 28 years. The staff's
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1 proposal was designed to provide manufacturers with the
2 lead time necessary to address such design changes.
3 --o0o--
4 MR. SALARDINO: So to summarize:
5 Staff is proposing a Tier 3 HC+NOx exhaust
6 emission standard of 50 grams per kilowatt hour for
7 engines less than 50 cc, equivalent to the most stringent
8 federal standard for these engines.
9 For engines 50 to 80 cc the HC+NOx standard will
10 remain at the current level of 72 grams per kilowatt hour,
11 as it is already equivalent to the most stringent federal
12 standard for these engines.
13 --o0o--
14 MR. SALARDINO: The Tier 3 standards for engines
15 above 80 cc will be based on the addition of a catalytic
16 converter and will begin implementation with the 2007
17 model year.
18 --o0o--
19 MR. SALARDINO: To encourage the manufacture and
20 use of engines that go beyond mandatory emission
21 standards, the staff proposes voluntary optional low
22 exhaust emission standards for small engines in connection
23 with the proposed Tier 3 standards.
24 An engine found to be certified to the voluntary
25 standards will be classified as a California Blue Sky
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1 engine. The Blue Sky standards represent a reduction of
2 50 percent below the proposed Tier 3 levels for HC+NOx.
3 The Blue Sky Engine Program provides an
4 opportunity for these engines to participate in clean
5 labeling and incentive programs. The manufacturer must
6 declare at the time of certification whether it is
7 certifying an engine family to a Blue Sky series standard.
8 In order to guarantee that emission credits associated
9 with the Blue Sky engine are real, engines certified to
10 these voluntary standards would not be eligible to
11 participate in the corporate averaging programs allowed in
12 the small engine exhaust emission regulations.
13 At this time staff is also suggesting amending
14 the Blue Sky Engine Program to include zero emission
15 equipment.
16 --o0o--
17 MR. SALARDINO: In addition to new standards,
18 staff also proposes a few other modifications to the
19 existing exhaust emission regulations and test procedures.
20 To more closely align with the federal
21 regulation, staff proposes to adopt the use of kilowatt as
22 the unit of power for small off-road engines.
23 Staff also proposes to include the federal 1,000
24 hour durability option for engines certified at or about
25 225 cc.
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1 In addition, staff proposes to incorporate the
2 federal small engine test procedures subparts A, B, D, and
3 E of CFR Part 90 in to California's test procedures for
4 2005 and later model year engines.
5 These changes will further ease the burden on
6 manufacturers certifying an engine family.
7 In 1998, the Board adopted a 65 cc displacement
8 limit on engines subject to the handheld emission
9 standards. However, since that time manufacturers have
10 noted increased consumer demand for more power from
11 handheld engines, requiring engine size above the 65 cc
12 limit.
13 Manufacturers requested a higher limit for
14 handheld engines and promised the continued introduction
15 of clean technologies. Staff, therefore, proposes to
16 increase the handheld category to include engines up to 80
17 cc beginning with the 2005 model year.
18 --o0o--
19 MR. SALARDINO: Staff also proposes a requirement
20 that a manufacturer report emission-related defects
21 affecting a given engine family -- a given family of
22 engines. A manufacturer will be required to file the
23 report with ARB whenever the manufacturer determines that
24 either a safety-related or performance-related defect
25 exists in 25 or more engines of a given family.
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1 ARB will then require the manufacturer to submit
2 a plan to resolve the nonconformity of the engines. A
3 resolution could be in the form of a recall of those
4 engines or alternative measures that offset the
5 noncompliance.
6 This requirement for defect reporting and recall
7 is similar to the current federal program and is also
8 included in staff's proposed evaporative emission
9 reduction program.
10 Staff also proposes to include additional text in
11 the test procedures that clarify engine clearing
12 requirements for certification emissions testing. This
13 clarification is necessary in order to ensure that the
14 test conditions are representative of real-world
15 conditions.
16 This concludes staff's proposal for amendments to
17 California's small engine exhaust emission programs.
18 At this point the presentation will show a slide
19 representing evaporative emission sources from small
20 engines. And I would like to turn the presentation over
21 to Mr. Jim Watson to discuss staff's evaporative emission
22 proposal.
23 (Thereupon an overhead presentation was
24 Presented as follows.)
25 BOARD MEMBER DeSAULNIER: For those of us who
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1 need visuals.
2 MR. WATSON: Good afternoon, Chairman Lloyd and
3 members of the Board.
4 The animated slide David shared with us depicts
5 the major sources of evaporative emissions from small
6 off-road engines. The proposal I will present today
7 covers staff's proposal -- the proposal I will present
8 today covers staff's proposal and two alternatives
9 suggested as 15-day changes that control emissions from
10 these sources. The addition of these alternatives provide
11 manufacturers some needed flexibility in implementing the
12 proposed standards.
13 The first topic of the presentation will
14 highlight three elements of staff's proposal:
15 The discussion will briefly cover the proposed
16 standards, controlled technologies, test data, and
17 industry issues.
18 The presentation will then focus on ARB
19 alternative options developed as a result of our working
20 with industry after the release of the staff report.
21 These alternatives are proposed as 15-day modifications.
22 I will close the presentation with a discussion
23 of the proposal's overall cost effectiveness, cost,
24 overall controlled emissions comparison, and finally
25 staff's conclusions.
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1 --o0o--
2 MR. WATSON: The primary elements of the
3 evaporative proposal are a fuel tank permeation standard
4 for handheld equipment, three diurnal standards for
5 non-handheld equipment, and certification.
6 --o0o--
7 MR. WATSON: This chart summarizes the proposed
8 permeation standard and implementation date for handheld
9 equipment.
10 Permeation occurs when a gas or liquid
11 saturates a permeable material and is released on the
12 other side.
13 An example of permeation would be the old
14 helium-filled rubber balloons. After several hours the
15 helium would permeate through the balloon's walls and the
16 balloon would go flat. That is why we now have mylar
17 party balloon, to control permeation.
18 For small gasoline engines permeation emissions
19 occur when gasoline saturates permeable materials like
20 high density polyethylene and rubber and evaporates on
21 their outside surfaces.
22 This proposal sets a
23 two-gram-per-square-meter-per-day fuel tank permeation
24 standard. Since most handheld equipment use sealed
25 systems to control tank and carbon vapors, staff's
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1 proposal does not include a diurnal evaporative emission
2 standard for this category.
3 The next slide discusses the diurnal standards as
4 they apply to non-handheld equipment.
5 --o0o--
6 MR. WATSON: This slide summarizes the proposed
7 diurnal standards and implementation data for non-handheld
8 equipment.
9 Diurnal emissions occur as a result of daily
10 temperature variations and include vented and permeation
11 emissions. This proposal does not include separate
12 permeation standards for non-handheld equipment tanks
13 because permeation is addressed by the proposed diurnal
14 standards and test procedures.
15 The three diurnal standards that apply to
16 non-handheld Class 1 and Class 2 equipment include a
17 one-gram-per-day diurnal standard for Class 1 walk-behind
18 mowers, a diurnal standard based on tank volume for other
19 Class 1 equipment, and a two-gram-per-day diurnal standard
20 for Class 2 equipment.
21 --o0o--
22 MR. WATSON: The final element of the evaporative
23 proposal is certification. Staff's proposal requires all
24 equipment to be certified. Manufacturers must test at
25 least one worst case engine or fuel tank for non-handheld
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1 equipment within each evaporative family with the highest
2 emissions potential.
3 Handheld tanks and non-handheld equipment are
4 tested and certified per applicable test procedures as
5 listed in the slide. The certification and test
6 procedures are an integral part of the evaporative
7 proposal.
8 --o0o--
9 MR. WATSON: I would now like to discuss
10 technologies for controlling permeation emissions.
11 Controlling permeation emissions is meeting the
12 proposed standards. There are a number of proven
13 technologies that can be used to control fuel tank
14 permeation emissions, which include metal tanks, nylon
15 tanks, and barrier treatments.
16 Options for controlling permeation emissions from
17 other fuel system components include the use of thermal
18 plastic materials and teflon.
19 --o0o--
20 MR. WATSON: Based on experience from the
21 portable fuel container rule, barrier treatments are an
22 option that can be used to control fuel tank permeation
23 emissions when optimized resins and additives are used.
24 Staff validated the effectiveness of applying a
25 barrier treatment by performing permeation testing on
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1 three untreated and three fluorinated fuel tanks. The
2 average test results show that fluorination is quite
3 effective and to reduce permeation emissions by more than
4 98 percent when optimized.
5 I will now go on to a discussion of technology
6 that controls the portion of the diurnal emission that
7 arises from vented tanks.
8 --o0o--
9 MR. WATSON: There are three basic technologies
10 that control vented diurnal emissions. The technology
11 consists of sealed systems, carbon cannisters, and hybrid
12 systems.
13 Sealed systems are the most effective in reducing
14 emissions, but require fuel tanks designed to withstand
15 pressure.
16 Cannister technology has a proven track record in
17 on-road applications.
18 And the hybrid systems are basically sealed
19 systems that vent to a cannister above a fixed pressure
20 limit.
21 --o0o--
22 MR. WATSON: Staff evaluated prototype equipment
23 configured with technology to control permeation and
24 vented emissions in an effort to develop appropriate
25 diurnal standards. Staff tested six walk-behind mowers
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1 configured with sealed systems, fluorinated tanks, and
2 low-permeation fuel lines. We also tested a generator and
3 a commercial mower configured with carbon cannisters,
4 metal fuel tanks, and low-permeation fuel lines.
5 --o0o--
6 MR. WATSON: In regard to the sealed system
7 testing, this chart showed the uncontrolled and controlled
8 test results for six mowers tested by ARB. The blue and
9 green columns represent uncontrolled results from mowers
10 tested with fuel containing MTBE and fuel containing
11 ethanol, respectively. The purple and gray columns
12 represent controlled emissions.
13 The controlled columns clearly show that the
14 proposed standards are feasible when tested with fuel
15 containing ethanol. However, staff is proposing that all
16 equipment be certification tested only with certification
17 fuel.
18 --o0o--
19 MR. WATSON: In regard to the cannister testing,
20 this chart shows the uncontrolled and controlled tests for
21 the generator and commercial mower when tested with
22 certification fuel. Staff were able to reduce average
23 emissions by 95 and 87 percent for the generator and
24 mower, respectively. The test results support staff's
25 finding that large non-handheld equipment can meet the
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1 proposed two-gram-per-day diurnal evaporative emission
2 standard.
3 In the last few slides I presented technical data
4 that supports staff's proposed permeation and diurnal
5 standards.
6 I would now like to discuss two additional
7 changes to the proposal that will be included as 15-day
8 changes.
9 --o0o--
10 MR. WATSON: Staff suggests lowering the
11 cannister design requirements in Test Procedure 902 from
12 two grams per liter of fuel tank volume to 1.4 grams per
13 liter of fuel tank volume for tanks one gallon and
14 greater, and one gram per liter for tanks less than one
15 gallon. The change will help solve packaging issues on
16 equipment configured with carbon canisters.
17 Another suggested 15-day change concerns small
18 volume manufacturers. Staff proposes to require small
19 volume manufacturers to submit a letter of conformance.
20 The change will allow certification staff to track small
21 volume equipment being sold in California.
22 There were many issues raised by industry. Most
23 of these issues had been resolved by staff's proposal.
24 However, several major issues were not resolved such as
25 stringency of the exhaust and evaporative standards,
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1 compliance flexibility, and costs. We invited industry to
2 come up with alternative proposals that would address
3 these issues while still achieving equivalent emission
4 reductions compared to staff's proposal.
5 --o0o--
6 MR. WATSON: Over the last several weeks Briggs
7 and Stratton, EMA and OPEI and Honda responded to staff's
8 invitation by proposing three alternative proposals.
9 Staff evaluated each proposal with respect to emissions
10 equivalency and enforceability. Subsequently staff
11 developed two alternatives from industry proposals which I
12 will identify as Alternative No. 1 and Alternative No. 2.
13 --o0o--
14 MR. WATSON: Key benefits of the alternatives is
15 that they provide industry with greater flexibility and
16 compliance, while providing additional evaporative
17 emission benefits at a lower cost.
18 The alternatives achieved essentially the same
19 level of benefits of the base proposal and still enables
20 the ARB to meet its SIP commitments.
21 --o0o--
22 MR. WATSON: Shown on the graph are the overall
23 exhaust and evaporative emission reductions of staff's
24 proposal in the Alternatives 1 and 2.
25 The alternatives achieve between 91 and 97
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1 percent of the emission reductions contained in staff's
2 proposal in 2010.
3 In 2020 the alternatives achieve between 98 and
4 99 percent of the reductions in staff's proposal.
5 --o0o--
6 MR. WATSON: I will now discuss the major
7 elements of the first alternative.
8 This alternative provides additional evaporative
9 emission reductions while equipment is operating, which
10 are defined as running loss emissions. It also contains a
11 requirement for testing complete engines, implements low
12 permeation fuel hoses one year earlier than staff's
13 proposal, and allows fleet averaging.
14 --o0o--
15 MR. WATSON: The first alternative sets a 2006
16 fuel hose standard and less stringent interim diurnal
17 standards based on tank volume for all Class 1 engines.
18 Setting interim standards will allow manufacturers time to
19 control production variability as evaporative technology
20 is adapted to off-road equipment.
21 In 2009, the diurnal standards for Class 1
22 engines are lowered. Standards that apply to Class 2
23 engines under the first alternative include a 2006
24 implementation of a fuel hose permeation standard and a
25 less stringent diurnal standard based on tank volume
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1 implemented in 2008.
2 --o0o--
3 MR. WATSON: I will now discuss the second
4 alternative. It also achieves additional running loss
5 emission reductions. Other major elements of the second
6 alternative include a requirement to test Class 1
7 walk-behind mowers, implementation of a low permeation
8 fuel hose is two years earlier than staff's proposal, and
9 reduces compliance testing for equipment certified by
10 design.
11 --o0o--
12 MR. WATSON: The second alternative requires
13 diurnal testing of walk-behind mower engines as part of
14 certification. This requirement ensures that the majority
15 of Class 1 engines meet specific emission targets.
16 Design-based standards apply to non-walk-behind mowers.
17 Beginning in 2005 all Class 1 equipment must meet a
18 post-permeation standard. For model years 2007 through
19 2011 interim performance and design standards apply to all
20 equipment. In 2012 the interim standards are lowered to
21 be equal to staff's proposal.
22 --o0o--
23 MR. WATSON: In this second alternative,
24 design-based also applies to Class 2 engines. In 2005,
25 they must meet a fuel hose permeation standard. In 2008,
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1 90 percent of a manufacturer's production volume must
2 comply with the additional interim design standards. The
3 following year, 100 percent of a manufacturer's production
4 volume must be compliant. In 2010, design standards for
5 fuel hoses in catalysts apply to small-volume
6 manufacturers. In 2013, the interim design standards are
7 lowered by setting a more stringent tank permeation
8 standard for 90 percent of a manufacturer's volume. In
9 2014, 100 percent of the manufacturer's volume must meet
10 the lower requirements.
11 This concludes staff's discussion of the
12 alternative options. The remaining portions of the
13 presentation will include both exhaust and evaporative
14 aspects of the proposal.
15 --o0o--
16 MR. WATSON: Staff's proposal for exhaust and
17 evaporative emissions is cost effective for both handheld
18 and non-handheld equipment.
19 Staff determined that the cost effectiveness for
20 handheld equipment will range from $1.71 to $6.21 per
21 pound of hydrocarbon reduced.
22 The cost effectiveness for non-handheld equipment
23 will range from a low of 20 cents to a high of $4.30 per
24 pound of hydrocarbon and NOx reduced.
25 For the alternatives under consideration staff
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1 expects the cost effectiveness will improve.
2 --o0o--
3 MR. WATSON: The estimated increase in the retail
4 price of handheld equipment will range from $2.16 to
5 $4.84, depending on the type of equipment purchased. The
6 estimated increase in the retail price of non-handheld
7 equipment will range from $37 for a walk-behind mower to
8 $179 for a commercial mower.
9 As the cost effectiveness improvement for the
10 alternatives under consideration staff expects retail
11 increases to be lower.
12 --o0o--
13 MR. WATSON: This chart compares the cost
14 effectiveness of major regulations adopted by the Board.
15 The $4 per pound average cost effectiveness of the
16 proposed handheld standards is lower than recently
17 approved control measures for some consumer products,
18 on-road motorcycles and enhanced vapor recovery. The
19 average $2.25 per pound cost effectiveness for
20 non-handheld equipment compares favorably with other
21 regulations.
22 --o0o--
23 MR. WATSON: The green columns of this chart show
24 the controlled emissions should the Board adopt the
25 proposal, which are significantly lower than the
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1 uncontrolled columns shown in light blue.
2 This shows a 22-ton-per-day reduction in 2010 and
3 a 50-ton-per-day reduction in 2020. Also shown in this
4 chart is a maximum change in controlled emissions for the
5 alternatives, which are represented by small purple
6 segments above the controlled emissions column.
7 As you can see, in 2010 the maximum shortfall of
8 the alternatives is .8 tons per day. In 2020, the maximum
9 shortfall is .9 tons per day.
10 --o0o--
11 MR. WATSON: In conclusion, staff has determined
12 that the proposal and alternative provide significant
13 emission reductions and will help to achieve attainment of
14 air quality standards that will benefit the health of all
15 Californians. Staff has determined that the proposed
16 standards are cost effective and attainable with existing
17 technologies.
18 Staff recommends Board adoption of the staff's
19 proposal including the alternatives. Adopting staff's
20 proposal and the alternatives will provide industry with a
21 great flexibility while retaining our emission-reduction
22 goals.
23 This completes my presentation. At this time I
24 would be happy to answer any questions you may have.
25 Thank you.
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1 CHAIRPERSON LLOYD: Thank you very much.
2 On your penultimate slide there, when you talk
3 about emissions reductions, what emissions reductions are
4 you talking about?
5 MR. WATSON: These are the exhaust and
6 evaporative emission reductions.
7 CHAIRPERSON LLOYD: Hydrocarbon plus NOx?
8 MR. WATSON: Hydrocarbon plus NOx or non-handheld
9 and handheld equipment.
10 CHAIRPERSON LLOYD: And what's the breakdown?
11 MR. WATSON: In 2020 there are about 6 tons per
12 day for handheld equipment and 43.5 tons per day for
13 non-handheld equipment.
14 EXECUTIVE OFFICER WITHERSPOON: There's more ROG
15 than NOx because they're new evaporative standards and
16 strengthened exhaust standards.
17 CHAIRPERSON LLOYD: So what was that again?
18 MR. WATSON: In 2020 there are about --
19 CHAIRPERSON LLOYD: In 2010 what was the
20 breakdown for hydrocarbon? X hydrocarbon plus Y NOx, what
21 was that? And the same for 2020.
22 EXECUTIVE OFFICER WITHERSPOON: He was providing
23 it in handheld and non-handheld, which is why I jumped in
24 and gave it -- told you that the thrust of it is ROG.
25 But they'll get that answer.
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1 CHAIRPERSON LLOYD: You see you're talking to a
2 chemist.
3 EXECUTIVE OFFICER WITHERSPOON: It should mostly
4 be ROG.
5 CHAIRPERSON LLOYD: While you're working that
6 out, again, just for clarification, that the way it was
7 described, staff came up with their proposal and then
8 worked with the industry after shipping an earlier
9 version, tried to get some of the ideas from industry and
10 then tried to incorporate those. And as a result we've
11 come up with a proposal which incorporates several of the
12 ideas that the industry has. Is that a fair --
13 EXECUTIVE OFFICER WITHERSPOON: That's correct.
14 And they came very, very close to our original staff
15 proposal, within less than a ton of what our regulation
16 would provide.
17 CHAIRPERSON LLOYD: Okay.
18 Professor Friedman.
19 BOARD MEMBER HUGH FRIEDMAN: I didn't hear you
20 address the safety concern that's been raised in the
21 correspondence we received, the fire specifically. I
22 guess that has to do with the exhaust controls and the
23 catalytic conversion.
24 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.
25 We did address it partially in the charts that showed the
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1 testing we did down in Texas where we measured the
2 increase in exhaust temperatures. And you saw mixed
3 results. The catalyst actually resulted in a slightly
4 cooler muffler lower and some engines and up to 200
5 degrees higher in other engines.
6 One of the points that we've considered is the
7 fact these are hot exhaust without a catalyst, and they
8 could catch fire to things. And for that reason the
9 engines provide shielding and other protection to protect
10 against fires and to protect against you putting your hand
11 on it.
12 BOARD MEMBER HUGH FRIEDMAN: Tom, I want to be
13 sure I understand this. I think it's very important.
14 Would you mind repeating what you're saying. And I want
15 to -- I want to be sure I'm hearing it.
16 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: And
17 I've got about a three-part answer unfortunately here. So
18 bear with me on -- if the first part doesn't answer all
19 the questions.
20 We were aware of the -- very aware of the safety
21 issue. We equipped engines -- six different engines with
22 catalytic converters in a test facility down in Texas.
23 And we measured the temperatures of the surface of the
24 catalyst, the temperatures of the exhaust, and so forth.
25 What we found was on some of the mowers the temperature
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1 didn't go up and some of them it did go up. And the
2 temperature of the exhaust and the muffler is very hot
3 either way. Adding a catalyst on several engines raised
4 it by up to 200 degrees. So it got hotter.
5 We then looked at, can that be shielded? Here's
6 the data here. Can it be shielded and protected? The
7 manufacturers already do that because at, you know 500 to
8 600 degrees, which is a current muffler temperature, they
9 don't want you to put your hand on it and they don't want
10 grass to go on it because it could catch on fire.
11 So these are -- there's additional heat. But we
12 believe that they could manage that heat by shielding and
13 proper design of the exhaust system.
14 Subsequent to that testing and in publishing and
15 in our staff report the industry came back and said, "You
16 know, this does cause a lot of problems for us." The
17 catalyst, because it's burning up a lot of pollution from
18 these engines, which are fairly high polluting engines --
19 burning them up creates heat. That's what the process is.
20 And they came back and said, "Look, it still causes us a
21 lot of problems. When the temperature goes up, there's
22 plastic next to it, we might have to change the plastic.
23 It creates the need for more shielding. More shielding
24 might catch the grass more and cause a fire hazard." All
25 these different things.
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1 We were personally convinced that there were
2 engineering solutions to that. The purple bar shows you
3 one of them. It shows you how much the temperature can be
4 dropped by a good heat shield on that Honda. But, you
5 know, we were sensitive to the arguments. So when, as in
6 the previous discussion, we invited the industries to come
7 back with alternative proposals, they came back with an
8 alternative proposal -- two different alternative
9 proposals that had a less stringent exhaust emissions
10 standard. And instead of getting a 50 percent reduction
11 in tailpipe emissions, it was about 35 percent.
12 And what they have told us, a number of them, and
13 you'll hear it in testimony I believe today, is that
14 because less pollution is being converted by the catalytic
15 converter, there will be less heat and that the heat that
16 will be there is manageable and does not create a safety
17 hazard. So we believe that the alternatives that we're
18 offering for your consideration today remove any safety
19 issues that were there at all. We don't think they were
20 there in the first place. They could be solved. But they
21 removed them from the table. And we hope that you will
22 hear that in testimony today.
23 BOARD MEMBER HUGH FRIEDMAN: Sufficiently reduces
24 the emission reduction resulting in greater heat by
25 reducing the -- and, therefore, reduces the heat?
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1 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah.
2 If there's less -- if the catalyst is less efficient --
3 BOARD MEMBER HUGH FRIEDMAN: And, therefore,
4 reduces the risk of fire.
5 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.
6 So the tradeoff is the heat comes down, we get less
7 emission reduction. But in the proposals we challenged --
8 BOARD MEMBER HUGH FRIEDMAN: But you get more
9 evap?
10 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.
11 We challenged the industry to come and take that --
12 BOARD MEMBER HUGH FRIEDMAN: Which doesn't reduce
13 NOx so much, but it does reduce --
14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
15 it loses -- the exhaust side loses both NOx and
16 hydrocarbons. And it's made up with hydrocarbon evap
17 control that goes beyond what we had proposed.
18 BOARD MEMBER HUGH FRIEDMAN: Has there been any
19 additional communication with any of the fire fighting
20 groups?
21 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes, we
22 have talked to a number of them today. I can't -- you'll
23 have to wait until they testify, but I believe that there
24 will be evidence that they believe this addresses the
25 associations --
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1 BOARD MEMBER HUGH FRIEDMAN: So that's why it's
2 really not listed as an ongoing issue of any --
3 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.
4 We think it has been solved by this.
5 BOARD MEMBER HUGH FRIEDMAN: Okay. Thank you.
6 CHAIRPERSON LLOYD: Go back to the previous
7 slide, the previous one to this.
8 Just to clarify there, that -- because black and
9 white doesn't come through so well. So what we're saying,
10 if I look at the different engines, that there are a
11 certain number at zero hours and then after 125 hours,
12 depending on the engine, there's a significant
13 degradation. Am I reading that correctly?
14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.
15 The ones labeled Briggs and Stratton, we had problems with
16 both of those engines. It's not related, we don't
17 believe, to the catalyst. It was related to changes in
18 the engine that resulted in higher emissions. And as you
19 can see from the other manufacturers, the deterioration
20 was quite minimal. The purpose of doing this testing in
21 part was to determine if these very inexpensive catalysts
22 would wear out real fast. And the data suggests that they
23 will not.
24 The conversion efficiency in those tall blue
25 bars, the first two under Briggs and Stratton was still
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1 very high. It's just that the engine was putting out a
2 whole, whole bunch more emissions due to some problem with
3 the engine.
4 CHAIRPERSON LLOYD: So was this typical of Briggs
5 and Stratton?
6 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: I don't
7 know. It's a sample of two, so I don't -- I couldn't tell
8 you that.
9 CHAIRPERSON LLOYD: So two out of two?
10 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: I think
11 the staff could comment on whether they figured out what
12 the problem was and resolved it.
13 CHAIRPERSON LLOYD: Well, one of the -- and what
14 I'm driving at here, if we got some inherently high
15 emitters in this category and if certain varieties are
16 more prone to that, how do we follow up? I mean we can
17 have these engines, which maybe meet our certification
18 numbers, but they get out in the field and then they
19 become gross polluters.
20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
21 until --
22 CHAIRPERSON LLOYD: So what mechanism is there to
23 prevent that?
24 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
25 until -- well, first of all, the regulation is structured
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1 so that there could be testing of these when they're new.
2 And if there's a problem, there can be a recall. We know,
3 however, that a recall in the traditional sense is not
4 going to work very well because we're not going to -- you
5 know, who's going to turn their lawnmower in? With cars,
6 you know, we can tie it to registration. But in this
7 case, it's harder to do with lawnmowers. But despite
8 that, that is a regulatory lever that we have -- or
9 enforcement lever.
10 Second of all, we are in the stages of completing
11 construction of a test facility down in El Monte where we
12 could test these engines ourselves. And based on that we
13 can take appropriate action if we find that the emissions
14 are high.
15 CHAIRPERSON LLOYD: How many lawnmowers have we
16 recalled because of emissions problems?
17 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
18 we've never -- until now we've never been able to test
19 them ourselves. We've only been able to go to their
20 assembly line and look at an assembly line. We have had,
21 quote, recalls on the assembly line of several models that
22 were not meeting emissions standards.
23 CHAIRPERSON LLOYD: But do we have a plan for
24 looking at in-use testing?
25 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.
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1 We will test them when they're new or, you know, picked up
2 from the dealership. And we can also test them in use.
3 CHAIRPERSON LLOYD: So maybe we could work with
4 the districts on that and looking at a mechanism where we
5 can pull these in and test them.
6 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.
7 CHAIRPERSON LLOYD: Unless you're thinking of OBD
8 for lawnmowers.
9 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Not
10 yet.
11 CHAIRPERSON LLOYD: Well, but that's -- again,
12 that's a real cause for concern as we look at that because
13 it can be in doing our best efforts here to get it. And
14 particularly as we look at the variation in the quality of
15 the different manufacturers.
16 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.
17 And this is -- unfortunately this is symptomatic of all of
18 the off-road engine equipment. It's not registered;
19 therefore, it's harder to enforce through license plates
20 and annual registration. And, you know, we also don't
21 have the capability of testing much of this stuff. So we
22 are -- we have a weaker ability on the off-road to enforce
23 it. But we're trying to address it with the best tools
24 we've got, given --
25 CHAIRPERSON LLOYD: But if we buy the cleanest
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1 cars possible and we get in to the P-ZEVs and AT P-ZEVs,
2 one trip around our lawn -- finish our lawn, we've undone
3 a lot of the good we've done.
4 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes,
5 that is absolutely true.
6 BOARD MEMBER D'ADAMO: Mr. Chairman?
7 CHAIRPERSON LLOYD: Yes, Ms. D'Adamo.
8 BOARD MEMBER D'ADAMO: Along those lines, I think
9 one way to address this issue is with a zero emission
10 requirement. And I'm a little disappointed that we
11 weren't able to accomplish that in this proposal. But I'm
12 interested in seeing what this Board can do on that issue
13 perhaps at a future date.
14 So I'd just like to put that out there to other
15 Board members. And when we wrap things up, I'd be
16 interested in including a component in the resolution that
17 we come back on that issue.
18 BOARD MEMBER RIORDAN: Mr. Chairman?
19 CHAIRPERSON LLOYD: Yes, Mrs. Riordan.
20 BOARD MEMBER RIORDAN: I'm just wondering if
21 staff has completed their work on your original question.
22 MR. WATSON: Yes, we have.
23 CHAIRPERSON LLOYD: Thanks for reminding them.
24 MR. WATSON: Well --
25 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: we
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1 stalled for a long time there so they could get to it.
2 MONITORING AND LABORATORY CHIEF LOSCUTOFF: Okay.
3 The emission reductions in 2010 are roughly 22 tons a day.
4 And that's split between about 6 tons per day for the
5 non-handheld, 16 for the -- excuse me.
6 CHAIRPERSON LLOYD: Repeat that.
7 MONITORING AND LABORATORY CHIEF LOSCUTOFF: Six
8 tons a day for the handheld.
9 CHAIRPERSON LLOYD: Six. What's the total there?
10 MONITORING AND LABORATORY CHIEF LOSCUTOFF:
11 Twenty-two.
12 CHAIRPERSON LLOYD: Twenty-two.
13 MONITORING AND LABORATORY CHIEF LOSCUTOFF: Six
14 for handheld, 16 for non-handheld. That's roughly 22/78
15 percent split.
16 Then in 2020, we're talking about a
17 50-ton-per-day reduction, which is approximately 43 tons a
18 day for the non-handheld and 7 tons a day for the
19 handheld, which is about a -- I did that in reverse.
20 The NOx/hydrocarbon split. Okay.
21 CHAIRPERSON LLOYD: That was the question.
22 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Just of
23 the 22 --
24 MONITORING AND LABORATORY CHIEF LOSCUTOFF: The
25 NOx/hydrocarbon split for the 22 tons in 2010, 4 tons of
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1 that are NOx. The rest of it is hydrocarbon.
2 In 2020, the NOx is reduced by roughly 8 tons per
3 day of the 50 tons a day total.
4 EXECUTIVE OFFICER WITHERSPOON: And those
5 calculations are for the base staff proposal where if we
6 did any of the alternatives, the NOx reduction would be
7 less, correct?
8 MONITORING AND LABORATORY CHIEF LOSCUTOFF: Yes.
9 EXECUTIVE OFFICER WITHERSPOON: It would go up in
10 hydrocarbons and down in NOx?
11 CHAIRPERSON LLOYD: Thank you.
12 Mr. Calhoun.
13 BOARD MEMBER CALHOUN: Yes. I want to get back
14 to the question that you asked, Mr. Chairman. And at
15 least I thought I heard you ask the question about these
16 lawnmowers in use and testing them. Are you talking about
17 testing my lawnmower or are you --
18 CHAIRPERSON LLOYD: Well, random sample of how do
19 we find out what the, if you like, the emissions from this
20 category is in use.
21 Well, I know you got an electric lawnmower, so
22 you don't have a problem.
23 (Laughter.)
24 BOARD MEMBER CALHOUN: Well, I have to talk to
25 Jerry about that.
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1 CHAIRPERSON LLOYD: Professor Friedman said --
2 maybe I misunderstood you -- you were offering yours to be
3 tested at El Monte?
4 BOARD MEMBER CALHOUN: No.
5 CHAIRPERSON LLOYD: No. Okay.
6 BOARD MEMBER CALHOUN: I'm just -- there are a
7 lot of lawnmowers out there, an awful lot of them. And
8 there are a lot of hydrocarbon emissions from these
9 lawnmowers. But I question whether or not it's practical
10 to get in-use lawnmowers and retrofitting them or just new
11 ones.
12 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: No,
13 there's no talk about retrofitting them. It's just -- the
14 question was, if the lawnmower emits 1 gram per hour,
15 whatever the number is, when we certify it, is it going to
16 be one in use or is it going to be two in use. And so we
17 can find that out reasonably well with a sample of, I
18 don't know, 50 lawnmowers. With our new facility we can
19 test those pretty quickly.
20 So, you know, over time we would get an audit of
21 whether or not these engines are complying.
22 BOARD MEMBER CALHOUN: Well, what happens if you
23 do test it and find that it's exceeding the standard? It
24 may be exceeding because Bob Cross tampered with it.
25 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
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1 we'll have to -- we'll find that out from those mowers,
2 yeah. I mean that's what we could do.
3 BOARD MEMBER CALHOUN: And then what do you do?
4 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: It's no
5 different than what we've done on cars. I mean we sort of
6 found the same thing on the earlier cars. They were clean
7 when they were produced. They were dirty six months
8 later. And we had to come up with anti-tampering programs
9 and various other things to assure that their emissions
10 are low. And we were successful.
11 We just want to do the same due diligence on
12 lawnmowers. I don't know the answer, and so I don't know
13 what the solution would be if there is a problem. But we
14 have to figure it out. But at least we have the tool now
15 to be able to do it. We can do it in southern California
16 and --
17 CHAIRPERSON LLOYD: Bob --
18 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: -- give
19 you feedback.
20 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS:
21 Jack, you reminded me that the current proposal stops with
22 new. In other words, it is defects reporting and assembly
23 line testing type of measures. So the activity that we're
24 doing with the in-use would be data gathering as opposed
25 to real enforcement at this point.
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1 We have done some in the past. And I think we'll
2 just -- and that's really kind of helped us understand
3 some in-use -- not in-use test, but at least durability
4 testing. That's helped us understand what the mowers do
5 in the first place. An we'll just continue that.
6 So I don't think you have to worry about
7 lawnmower smog check for a few years. And I'll probably
8 still be able to tamper.
9 That was a joke at the end.
10 CHAIRPERSON LLOYD: Professor Friedman.
11 BOARD MEMBER HUGH FRIEDMAN: One other question.
12 It's I guess related, but broader.
13 Is it true that to the extent that these rules
14 would only apply to small engines, under 175 horsepower,
15 or small motors, that they only account for 1 percent of
16 our smog-forming emissions in California overall? Is that
17 a true statement?
18 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: I think
19 the numbers that have been floating around all the press
20 releases get a little mixed up.
21 As I recall, the lawnmowers, which are the ones
22 under 25 horsepower, are on the order of a few percent of
23 our emissions. The ones that --
24 BOARD MEMBER HUGH FRIEDMAN: So it's the little
25 lawnmower's 2 percent? But --
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1 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah,
2 lawnmowers and other lawn and garden. And that's under
3 25, which is the subject of the proposal.
4 BOARD MEMBER HUGH FRIEDMAN: Yeah. But under
5 175?
6 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: It was
7 13 percent of -- the non-preempted engines were 13 percent
8 of all the mobile source emissions, which is -- for HC and
9 NOx is probably 60 or some percent of all of the
10 emissions. So we're probably talking about 7 percent or
11 something, on that order, for the under 175 off-road
12 equipment.
13 BOARD MEMBER HUGH FRIEDMAN: Seven percent?
14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah,
15 and of the -- that had a lot of diesels in it. And they
16 represent the off-road. Diesels represent about 44
17 percent of the toxic particulate emissions overall.
18 BOARD MEMBER HUGH FRIEDMAN: Okay. Thank you. I
19 just wanted to get the record straight, at least.
20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: My 13
21 was 17 percent. So it's probably 17 times .6. So maybe
22 like 10 percent for all of -- of the smog-forming
23 emissions for all of -- all of the under-175, which is
24 gasoline, diesel, way more than this proposal deals with.
25 And this is a few percent.
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1 CHAIRPERSON LLOYD: Thank you.
2 Seeing no other questions, I guess we go to
3 our -- well, first of all, ask Madam Ombudsman -- pleased
4 to see you had your wake-up call.
5 Would you please describe the public
6 participation process that occurred while this item was
7 being developed, and share any concerns or other comments
8 that you may have with the Board at this time.
9 OMBUDSMAN TSCHOGL: I was going to apologize for
10 the misbehavior of my device. But, anyway, I'll just get
11 on with this.
12 Mr. Chairman and members of the Board, this
13 control measure has been developed with input from the
14 Engine Manufacturers Association, Outdoor Power Equipment
15 Institute, Portable Power Equipment Manufacturers
16 Association, Manufacturers of Emission Controls, and
17 several private companies.
18 In 2000, staff began its effort to draft a
19 regulation to control evaporative emissions from small
20 off-road engines. And on November 9th of that year they
21 held their first public workshop.
22 Subsequent workshops were held in 2002 and 2003.
23 In 2002, staff introduced its exhaust emission reduction
24 proposal for small off-road engines. During this nearly
25 three-year period, four public workshops were held.
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1 Staff also had approximately 40 meetings with
2 trade associations and a significant number of one-on-one
3 meetings with several companies.
4 That concludes my comments. Thank you.
5 BOARD MEMBER DeSAULNIER: They're trying to
6 figure out, is it Bach, Beethoven, Mozart, or was it Howdy
7 Doody?
8 (Laughter.)
9 OMBUDSMAN TSCHOGL: I have no idea.
10 BOARD MEMBER CALHOUN: May I ask the staff one
11 question.
12 About how many workshops? I counted four or
13 five.
14 OMBUDSMAN TSCHOGL: There were four public
15 workshops.
16 BOARD MEMBER CALHOUN: Okay. And the industry, I
17 assume, had adequate time to express its views regarding
18 the feasibility of the technology?
19 OMBUDSMAN TSCHOGL: I believe so.
20 EXECUTIVE OFFICER WITHERSPOON: They had years.
21 OMBUDSMAN TSCHOGL: I believe everyone was quite
22 involved.
23 BOARD MEMBER CALHOUN: Okay. Thank you.
24 That's all.
25 CHAIRPERSON LLOYD: Thank you.
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1 I'd like to call up our first three witnesses.
2 Bonnie Holmes-Gen, Jed Mandel, and David Raney.
3 Bonnie?
4 I saw her earlier, but maybe she has left. So I
5 guess -- we have Bonnie's testimony on behalf of the Lung
6 Association, the California Electric Transportation
7 Coalition, Center for Energy Efficiency and Renewable
8 Technologies, Coalition for Clean Air, Natural Resources
9 Defense Council, Steven and Michele Kirsch Foundation,
10 Sierra Club, Union of Concerned Scientists. And this is
11 in support of our regulation.
12 Jed Mandel.
13 MR. MODISETTE: Excuse me, Mr. Chair. That
14 was -- I'm going to be presenting the letter that you just
15 read.
16 CHAIRPERSON LLOYD: Later on?
17 MR. MODISETTE: Yes.
18 CHAIRPERSON LLOYD: Okay. Thanks, Dave.
19 Jed Mandel, David Raney, Bill Guerry.
20 MR. MANDEL: I know you're excited and pleased to
21 see me so soon again from this morning. I was actually
22 hoping not to see you so soon again. I'd asked to testify
23 at the end of this item because there's a lot of new
24 information that has been shared just in the staff report.
25 And it's possible there will be some new information
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1 shared by subsequent testifiers.
2 I'm pleased to go now, but if I might be able to
3 have a couple moments afterwards.
4 CHAIRPERSON LLOYD: No, if you'd like to go at
5 the end, and I respect your desire to do that, if staff
6 has no problem.
7 MR. MANDEL: It would save time in case there's
8 something else that I need to respond to.
9 CHAIRPERSON LLOYD: As long as -- you know, as
10 long as we can assume you're going to move across from
11 left. As long as you go left.
12 MR. MANDEL: I promise to cut my hour testimony
13 down to at least 45 minutes.
14 CHAIRPERSON LLOYD: Thanks.
15 So then we have David Raney and Bill Guerry.
16 MR. RANEY: Gosh, I wanted to go last.
17 (Laughter.)
18 CHAIRPERSON LLOYD: Okay.
19 MR. RANEY: I believe everybody has a written
20 copy of our statement.
21 There's a major change I need to ask you to make,
22 and that's to change "good morning" to "good afternoon."
23 That's the most major change.
24 Good afternoon, ladies and gentlemen of the Board
25 and Chairman Lloyd and Executive Officer Witherspoon and
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1 staff.
2 My name is David Raney. I'm the Senior Manager
3 of Environmental and Energy Affairs at American Honda
4 Motor Company headquartered here in California.
5 I'm pleased to be hear on behalf of my company,
6 our Power Equipment Division, which is based in
7 Alpharetta, Georgia, just north of Atlanta, and our Honda
8 R&D teams both here and in Japan.
9 I also have with me here Tom Bingham from
10 American Honda, whose desk is actually at our Power
11 Equipment Division office in Georgia, so he has a vested
12 interest in this as well.
13 I'm going to spend a few minutes with you just
14 explaining a little bit about Honda's product line so you
15 can kind of see where we have an interest in this.
16 We do design and produce in the United States a
17 significant portion of small engine products that we sell
18 here. We have a significant employment presence at our
19 factories and research and development facilities in North
20 Carolina, as well as a broad nationwide dealer network.
21 Our associates in North Carolina produce a
22 diverse product line of walk-behind mowers and engines for
23 countless OEM products. And we manufacture engines and
24 complete products in all displacement categories covered
25 by the staff proposal.
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1 In the small engine category we've got engine
2 models ranging from a four stroke 1 horsepower 25 cc
3 handheld engine for string trimmers to a 25 horsepower
4 V-twin engine that is primarily used on construction
5 equipment.
6 Honda supplies engines to thousands of equipment
7 manufacturers nationwide, both directly and through 28
8 engine distributors. The three engine distributors in
9 California supply engines directly to a 200 plus equipment
10 manufacturer network. The distributors have their own
11 dealer network that supplies engines and service for the
12 California market. And these folks are very important to
13 our business as well. Many of the Honda engines sold here
14 in California are used in rental and construction
15 equipment, and they are supported by 600 plus servicing
16 dealers.
17 We also supply engines for walk-behind mowers and
18 other products to several large volume equipment
19 manufacturers that produce product for sale in California.
20 And, finally, we manufacture complete products under the
21 Honda brand such as walk-behind lawnmowers, tillers,
22 generators, trimmers, and water pumps that are retailed
23 directly through a Honda dealer network, with some
24 lawnmowers and a tiller model also available at Home
25 Depot. There are 400 plus Honda sales and service dealers
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1 in this state.
2 Our primary interest is in protecting and growing
3 our business for these products and supporting our dealers
4 and customers by providing highly efficient, long lasting,
5 and quality products branded with the Honda name. And I
6 can assure you that we have no intention of reducing
7 employment or manufacturing capacity as a result of this
8 regulation.
9 As a corporation, Honda's philosophy of advancing
10 and applying cost effective low emissions control
11 technology to our products doesn't stop with our
12 light-duty vehicles and light duty trucks. It also
13 applies to the small engines and products under
14 consideration before you today.
15 We have a significant vested interest in the
16 outcome of this regulatory proposal, both for increased
17 environmental protection as well as in protecting the
18 availability and affordability of our products for our OEM
19 business partners, our dealers, and our retail customers.
20 With that said, I'll say that there are many
21 remaining concerns with the proposal before you today.
22 But that Honda can support the proposal if the Board can
23 direct the staff to resolve these concerns that we'll
24 discuss briefly in a satisfactory manner.
25 We have come a long way with staff during the
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1 past few months. And my company believes we have reached
2 a point today where we're almost there. I don't want to
3 give you or our customers or our colleagues in this
4 industry the idea that we wholeheartedly support the
5 proposal in its present modified form. There are several
6 concerns that must be resolved before we can fully support
7 the proposal. But we do not believe these are
8 insurmountable. Honda is prepared and very willing to
9 continue to work with staff on this under whatever the
10 decision the Board makes today.
11 It is important that you understand our remaining
12 concerns though and I want to outline those to you and
13 staff.
14 Before I begin, I would like to especially thank
15 the staff and its management for the open channels of
16 communication that have been maintained with industry
17 while we've deliberated this process. They have listened
18 and learned and so have we. I believe we have all
19 benefited from this. And we look forward to continuing
20 the open communication as we head to a final rule.
21 Now, several months ago, as the content of this
22 regulation and staff's original direction came clearer, we
23 began to express significant concerns about the following
24 issues:
25 We were concerned about the potential performance
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1 and cost differential between California and 49-state
2 product that might exist under the original proposal and
3 absent any new federal regulation that actually harmonized
4 CARB and EPA regulations. We expressed concern that our
5 customers and dealers in California could be penalized if
6 the products sold here had a significantly higher price
7 tag caused by the stringency of standards relative to
8 products sold outside of the state.
9 And, secondly, we expressed significant concern
10 about the potential impact on safety that the exhaust
11 portion of the original proposal and its level of
12 stringency might pose to our products and customers.
13 Finally, we clearly stated to staff the need for
14 an equitable and fair playing field in the certification
15 process, specifically on test procedure issues and the
16 means by which certain performance aspects could be
17 demonstrated under design-based standards.
18 While it is generally understood that increased
19 cost is usually associated with regulation, we believe
20 that staff has thoroughly addressed in its latest
21 revisions or will and can try to resolve these issues
22 before finalizing the rule, therein mitigating their
23 significant effects that were originally raised on the
24 market. The modifications to the exhaust and evaporative
25 emissions proposals put forth today have given us
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1 increased possibility to greatly lessen cross-border cost
2 differentials. And we believe staff is listening to our
3 concerns expressed about the need for a level playing
4 field in the certification process.
5 I want to say a few things specific to the issue
6 of safety. We have continued throughout this process to
7 bring this concern to the staff. It was a significant
8 concern. The proposal originally put forth by staff was
9 not acceptable to Honda because of the potential for
10 exhaust flames resulting from the high conversion rate
11 that you discussed earlier necessary to meet the
12 originally proposed exhaust standards. We think that the
13 modified exhaust emissions proposal presented today of 10
14 and 8 grams will make it possible to have an exhaust
15 system with a lower risk of being a fire safety hazard.
16 It's manageable today on our current products. And with
17 this revised proposal it will be manageable on the future
18 engines.
19 The revised proposal will also be significantly
20 more cost effective air quality improvement for
21 California.
22 This modification has been a positive and very
23 helpful change. While there is always risk, even on
24 today's products, due to their diversity of use or even
25 misuse in their application, we don't believe that the
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1 staff proposal presented here today for future exhaust
2 emission standards will have any significant impact on the
3 safety of our future engines in comparison to current
4 engines or products.
5 Now there are several issues that do remain as
6 concerns to Honda, as I stated earlier. I have attached a
7 list of these concerns to our testimony for the record.
8 And for the sake of preserving time, Chairman Lloyd, I
9 won't go through them specifically.
10 CHAIRPERSON LLOYD: We have copies here.
11 MR. RANEY: Okay. Again, happy to meet with
12 staff at any time to discuss our concerns there.
13 These are all important issues and we do believe
14 they must be addressed. But as I said earlier, they are
15 not insurmountable. We hope that the Board will guide the
16 staff today to work with our industry on these issues.
17 And we look forward to working with staff to address them
18 in the complex regulatory text that will no doubt
19 accompany them as soon as possible.
20 Our engineers need to have some certainty about
21 the timing of the regulation and clarity in the regulatory
22 language in order to continue the development of new
23 products in an efficient and timely manner. And as you
24 know and have seen this morning, some of the provisions in
25 the current proposal take effect even in the 2005 model
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1 year. For our development teams, that's today.
2 In closing, Chairman Lloyd, we hope that the
3 Board and staff view these comments as helpful and
4 constructive. And I thank you very much for your
5 attention and for your serious attention that you will
6 give to them.
7 CHAIRPERSON LLOYD: Thank you very much, Mr.
8 Raney.
9 Just a couple of questions there. Can I read
10 into your comments here that you would support us adopting
11 the regulation today provided that staff worked with you
12 to address those concerns in the 15-day period?
13 MR. RANEY: Yes.
14 CHAIRPERSON LLOYD: And the other one which you
15 had raised. And I think I read your statement correctly
16 there that this would be unacceptable because of safety
17 concerns early on. But given staff's modifications here,
18 you don't feel now that safety will be -- safety would be
19 a concern as a result of this regulation?
20 MR. RANEY: That's true.
21 CHAIRPERSON LLOYD: Fire hazard. Okay.
22 Well, that's very helpful. And, again, we really
23 appreciate your ability to work with staff on this issue
24 and staff worked with you. And clearly your pioneering
25 work on the automobile is a -- we're delighted to see that
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1 you're now turning that to helping us on some of the
2 smaller sources as well.
3 Professor Friedman.
4 BOARD MEMBER HUGH FRIEDMAN: To me this is
5 really, if not optimal, it's as close as it can get to the
6 way this should work, this process. Staff puts out a
7 proposal after a dialogue with the sources to be
8 regulated. And the regulators -- those to be regulated
9 respond. They give their concerns. Staff responds. They
10 have more conversation at workshops. And at least from
11 what I've just heard from Honda, there has been a
12 collaborative resolution, with a number of items yet to be
13 considered and addressed. But they're not so major in
14 principle that they prevent support from those to be
15 regulated, at least from Honda.
16 So to me, I congratulate you both at this point.
17 I hope we'll hear more of that. And I hope that -- I mean
18 it's always wonderful when you're presented with a
19 proposal that those who are going to have to bear the
20 cost, and hopefully pass it on to the consuming public,
21 have engaged in the process of working out the solution,
22 creatively and constructively, as you put it.
23 So I thank you, for one. And, again, I thank the
24 staff for being able to work this way.
25 MR. RANEY: I'd like to say that you've got a
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1 good staff and a tough staff as well. This was not an
2 easy thing to convince them of. But we kept bringing
3 bigger hammers.
4 (Laughter.)
5 CHAIRPERSON LLOYD: Well, of course one of your
6 biggest assets is one of your biggest problems. And, that
7 is, that your ability to meet the toughest standards
8 possible obviously helps us enormously, but also we
9 realize that it's a challenge for you. But you've always
10 come through.
11 Any other questions from the Board?
12 Thank you very much indeed.
13 Thank you, colleagues.
14 MR. RANEY: Chairman Lloyd, I will do that. And
15 if I could violate protocol a bit as well and ask for 15
16 more seconds. I'd like to do the same thing that Jed
17 Mandel said on behalf of our executive team at Honda.
18 You're going to miss Kathleen Walsh. We really
19 do appreciate the access that she's given to us in the
20 industry, clarifying questions and so forth. And I really
21 don't envy the person at the California Air Resources
22 Board that's got to make the decision to fill her shoes.
23 CHAIRPERSON LLOYD: Thank you very much.
24 MR. RANEY: So thank you, Kathleen.
25 CHAIRPERSON LLOYD: That's very nice.
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1 Bill Guerry, Joe Kubsh, and Rick Bell.
2 MR. GUERRY: Good afternoon. My name's Bill
3 Guerry. I serve as counsel for the Outdoor Power
4 Equipment Institute.
5 OPEI has a broad membership. We have 78 members.
6 American Honda is one of our important members. And we
7 are very diverse in our membership. We have sophisticated
8 world leaders like Honda that produce integrated products.
9 For the most part though the OPEI membership is comprised
10 of smaller and midsized companies who are non-integrated,
11 meaning that the large group of OPEI members are equipment
12 manufacturers that receive engines from separate
13 independent suppliers. And it's important to recognize
14 that those non-integrated equipment manufacturers,
15 particularly the small ones, are in a very, very different
16 place in terms of companies such as Honda.
17 And in that regard, it's the small members of
18 OPEI, many who are mom and pop operations with less than
19 50 employees, that critically rely on the association to
20 represent their interests. And they critically rely on
21 the CARB Board to ensure their procedural due process
22 rights are adequately represented.
23 In this regard, over the last 15 years OPEI takes
24 great pride in working proactively with CARB staff in the
25 development of numerous regulatory proceedings that
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1 resulted in success in providing cost effective and
2 practical emission reductions.
3 In this vein, OPEI has succeeded resolving the
4 most significant compliance issues for our separate and
5 distinct handheld members. And there is a separate
6 statement in the record for the OPEI handheld membership
7 that have come very close to working out to an acceptable
8 solution in this proceeding.
9 OPEI also recently submitted earlier this month
10 an industry counterproposal along with the Engine
11 Manufacturers Association. And as the staff presentation
12 showed, the industry counterproposal will achieve
13 California's air quality goals in a much more cost
14 effective and practical manner.
15 During the last few months OPEI has expressed and
16 shared its concerns -- and you heard Honda raise some of
17 the concerns -- on safety and cost effectiveness with CARB
18 staff. And we share the safety problems that have been
19 raised -- and I know that Mr. Friedman raised -- from
20 various safety organizations, particularly with regard to
21 pressurization of fuel systems and with regard to very
22 large, very hot catalyst systems; which given the
23 non-integrated nature of our industry and the fact that we
24 have many small equipment manufacturers who are relatively
25 unsophisticated, those safety issues take on added and, I
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1 think, unique dimensions that perhaps California and CARB
2 have not dealt with in other scenarios.
3 OPEI very much appreciates CARB staff's recent
4 recognition to basically -- you know, fundamentally
5 restructure the August 8th proposal and to work to develop
6 a framework for more cost effective regulations.
7 Unfortunately, we did not receive, in the OPEI
8 the framework on the evap program until late Monday night
9 of this week. It will take additional time for OPEI to
10 receive meaningful input and questions back from its 78
11 members who are located around the world.
12 At this time, we strongly feel that neither the
13 Board nor the public nor all these small OEMs have had
14 enough information about the new fundamentally different
15 approach that's been set forth in the three or four page
16 concept piece to determine how that document would be
17 implemented. For this reason, to ensure a meaningful
18 notice and comment process and to ensure a meaningful
19 Board review, OPEI urges the CARB Board to reschedule this
20 matter for final adoption at a future public board
21 hearing.
22 We also ask that the Board specifically instruct
23 CARB staff to work very closely with the independent
24 safety and fire stakeholders who have submitted
25 correspondence in this matter in drafting a new regulatory
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1 package that would be subject to the required 45-day
2 notice and comment period.
3 Finally -- and this is set forth in Section 6 of
4 the written comments that OPEI has submitted -- because of
5 the inherent production, distribution, and cost
6 limitations associated with relatively inexpensive lawn
7 garden products, most lawn and garden manufacturers simply
8 could not produce for the national market the very
9 expensive CARB-compliant products with catalysts and
10 carbon canisters.
11 I think you saw staff numbers that are exceeding
12 a hundred dollars a unit. And we've submitted a cost
13 study from that indicates much higher numbers, even
14 associated with the -- with basically all the alternatives
15 before the Board.
16 Consequently, OPEI requests the Board to limit
17 the Tier 3 new program at a final Board hearing to
18 products sold in California. CARB has effectively done
19 this and structured several other programs to focus on the
20 California market and not to create the likelihood of de
21 facto national standards. In fact, the current Tier 2
22 exhaust standards for lawn and garden industry products
23 are on the wheel-product side limited to the California
24 market.
25 In summary, OPEI remains committed to working
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1 with the CARB staff to expeditiously bring back to this
2 Board a comprehensive cost effective, safe, and practical
3 regulatory package.
4 I'm happy to answer any questions.
5 CHAIRPERSON LLOYD: Thank you very much.
6 Professor Friedman.
7 BOARD MEMBER HUGH FRIEDMAN: I don't know so
8 much, Mr. Guerry, whether my question is to you or to
9 staff or both. But I understood that staff was in large
10 measure responding to or adopting the industry proposals
11 in modifying the original proposal of the staff and giving
12 us what we have before us today, whatever the time line.
13 And is that correct? Was -- is OPEI part of
14 the --
15 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes,
16 that's correct. We received two different alternatives in
17 the process here. And the -- or two different proposals.
18 And the two alternatives that you saw on our proposal to
19 you today reflect those -- in large sense reflect those
20 two industry proposals.
21 BOARD MEMBER HUGH FRIEDMAN: And is OPEI part of
22 the industry?
23 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.
24 One of them was EMA, OPEI, Briggs and Stratton proposal.
25 MR. GUERRY: If you look at Exhibit 8 to my --
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1 the OPEI written statement, that is the OPEI/EMA
2 counterproposal that was submitted on September 9th. If
3 you look on the first page of that, the bottom bullet says
4 that a core element of the counterproposal, quote, "limit
5 the scope of the program to California only."
6 So we've been very clear throughout this process
7 of one of the fundamental core elements because of the
8 problems with infrastructure, production, distribution has
9 been a California program. I know the Board, at least
10 looking at the public staff report, that information and
11 that -- and the importance of that program of course we
12 don't believe has been adequately fleshed out for you guys
13 to make a decision today. And that's one of the critical
14 reasons we feel this is an important Board decision with
15 significant policy implications, and that -- that you need
16 more time and you need clear options presented to evaluate
17 how to structure and how it could be structured in various
18 ways.
19 EXECUTIVE OFFICER WITHERSPOON: If I might
20 respond to the travel issue head on, because Mr. Cackette
21 responded to the technical aspects of the
22 counterproposals. Travel is a fundamental policy issue.
23 Whether or not this Board wishes to deny other
24 states the benefits of our work -- we do collaborate with
25 other states, most notably Texas and New York, and other
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1 states on the eastern seaboard, who join with us on motor
2 vehicle regulations, for heavy duty -- for example, the
3 NTE issue we worked on together. We've had states adopt
4 our low-emission vehicle regulations. And so as a policy
5 matter, we try not to draw a moat -- or create a moat
6 around California and say, "Well, we're figuring out our
7 problem, but you're stuck alone with yours." We like to
8 export our knowledge around the world.
9 But since the time that the question was first
10 raised to us and rebuffed it at a policy level, of course
11 to ultimately your decision, we have been engaged in a
12 fight in Congress with -- brought by one of the members of
13 OPEI, Briggs and Stratton, through an amendment introduced
14 by Senator Kit Bond to the VA HUD appropriation, which
15 would take away all states' ability to regulate this
16 category and other categories of off-road engines. And
17 states throughout the nation have rallied to our side to
18 defend the importance of these regulations.
19 And so at this time, given all that has gone on,
20 it would be most improper in our view to turn our back on
21 our allies in that fight and say, "We're going to
22 construct a measure that California and California alone
23 can implement," even if in return for doing that, Briggs
24 and Stratton agreed to drop the Kit Bond amendment. It's
25 just simply not a possibility anymore because of the
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1 battle that's been joined and the way that the lines were
2 drawn.
3 So it's correct to say we've made that
4 distinction before. We've created optional compliance
5 paths that don't export. We've done memorandas of
6 understanding that don't export. But generally we wish to
7 work with our colleagues in air pollution control around
8 the world and share our expertise and experience rather
9 than only look out for our own interest.
10 MR. GUERRY: Can I address that? Because my
11 client, the Outdoor Power Equipment Institute, has not
12 been a sponsor of the rider she mentioned.
13 However, having said that -- and I've had this
14 conversation with Tom and others -- it seems to me that
15 the objective and purpose of the CARB Board should be to
16 focus on the air quality for the breathers in California.
17 And to the extent that you create the likelihood of a de
18 facto national standard, you raise the bar significantly
19 in terms of scrutiny of national interest groups,
20 including national safety interest groups and other
21 stakeholders.
22 And it makes it a much harder pill for industry
23 to swallow because you're -- I think a lot of my members
24 would be willing to provide extremely clean, extremely
25 expensive -- the testing ground in California have serious
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1 reservations if you multiply that by a national market for
2 a product such as this. And, therefore, you create a much
3 greater burden and much greater difficulty for industry
4 and staff to reach a solution that would be in the best
5 interests of the public of California.
6 So by --
7 CHAIRPERSON LLOYD: Is Briggs and Stratton a
8 member of your --
9 MR. GUERRY: Briggs and Stratton is a member of
10 ours, as is --
11 CHAIRPERSON LLOYD: Well, let me also add to what
12 Ms. Witherspoon said, because I was also approached.
13 Because, as she said, this is a policy issue on travel.
14 And the feedback I gave was that I'm not high on travel.
15 But I don't know where my colleagues stand, and I would
16 entertain what was going on.
17 Before anything proceeded, then in fact one of
18 your members went to Washington. And the whole complexity
19 of the game changed. And I stand 100 percent behind staff
20 on this issue. Because talking about good faith, we were
21 operating in good faith. The rules were changed, not by
22 us. Staff continued to work in spite of that, continued
23 to work to bring a proposal before us.
24 And to say that we -- our obligation here is --
25 that we are somehow doing something wrong, I think it
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1 really relates to the facts and it skews the facts. When
2 I see one of the members, as you saw earlier, providing
3 products to us, and when I see another member coming
4 forward and saying they can live with this, and that their
5 products clearly are cleaner, our obligation to clean air
6 in California is very clear.
7 We didn't start the game in California -- in
8 Washington. We would not wish to do that. We would like
9 to work with you. We've demonstrated we have by a hundred
10 percent. We cannot turn our backs on our allies and the
11 rest of this country and our representatives in
12 Washington. We cannot do that.
13 So then let's make it clear. Our obligation is
14 to the citizens of California, to protect air quality.
15 We've done that throughout the years, no matter what the
16 administration.
17 And in fact we can go out and drive cars today --
18 we've seen the results of that. And we have a very proud
19 record. And we're not going to go down and play the game
20 that's being played.
21 So it's very clear to us the message you're
22 getting. We may lose, but we will lose with honor. And
23 we will lose trying to protect the rights of the citizens
24 of California and every other state.
25 That's all to be said on this issue. I would
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1 like to move on.
2 And I sympathize with you, by the way, because
3 all of us would not like to be in this place.
4 Professor Friedman.
5 BOARD MEMBER HUGH FRIEDMAN: So I guess except
6 for the travel issue, which you've raised, the proposals
7 that are in -- you also said you needed more time --
8 MR. GUERRY: Well, I --
9 BOARD MEMBER HUGH FRIEDMAN: -- to evaluate the
10 cost elements.
11 MR. GUERRY: No, no. Let me be very clear.
12 Travel was one of the core elements in the
13 counterproposal that I wanted -- I was responding to your
14 question that has not been addressed.
15 There are, we believe, numerous Board policy-type
16 issues that have also not been addressed in the four-page
17 outline that we got for the first time shortly before this
18 meeting and that we saw in, I guess, a two-page outline
19 late Monday night. And we believe that there are major
20 significant issues --
21 BOARD MEMBER HUGH FRIEDMAN: What are they,
22 please, besides travel and cost?
23 MR. GUERRY: I mean some of it has to do with the
24 framework of the new alternatives that have been added
25 that have not been part of any discussion with the
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1 associations and CARB staff, including there appears --
2 there apparently is now an entirely new alternative with
3 an averaging program that I'm not in a position to even be
4 able to get approval from my membership as to what that
5 even means and how that will come unfold.
6 There are also significant issues in terms of
7 executive office approval of some sort of equivalent
8 running loss controls. And that's something that's a
9 promising option, but it's something that needs to have
10 greater clarity and Board review. And I guess we see --
11 and I think talking to some of the CARB staff, I think
12 every -- I think CARB staff is in an untenable position
13 that in the time that we've made this progress, they're
14 put with having to not get the ultimate Board approval
15 that I would certainly want if I was in their shoes.
16 And I think you guys need to stay involved in
17 overseeing the process. And I don't see a downside in
18 doing that. And all we're asking for is to have -- let us
19 continue to work this out, get it to a more refined clear
20 notion, fill in some of the big holes, and have greater
21 comfort that at the Board level there's been a review and
22 approval, as I think it was intended for the CARB to
23 operate in a meaningful review role.
24 CHAIRPERSON LLOYD: Well, I think we can do this.
25 We have the 15-day comment period. We could do this.
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1 EXECUTIVE OFFICER WITHERSPOON: We do believe
2 except for travel that the issues are mostly ministerial.
3 If we're wrong about that and something major were to
4 arise, we would of course return to the Board. But we
5 don't think you need to make a presumption today that
6 that's going to occur. You can trust us to bring it back
7 and seek your policy direction if in fact a major policy
8 issues erupts.
9 CHAIRPERSON LLOYD: And we have checked with our
10 legal staff. And we feel confident about going ahead.
11 But, again, I wish we were not in this position.
12 But that's where we find ourselves.
13 MR. GUERRY: Thank you very much.
14 CHAIRPERSON LLOYD: Thank you.
15 Joe, Rick Bell, Don Anair.
16 MR. KUBSH: Good afternoon again, Chairman Lloyd
17 and members of the Board. Joe Kubsh, Deputy Director of
18 the Manufacturers of Emission Controls Association.
19 I'm proud to stand here to strongly support the
20 proposal as put forward, even with the modifications as
21 presented by staff this afternoon.
22 We commend the Board for its continuing efforts
23 to develop and implement effective control programs for
24 major sources of air pollution, including small off-road
25 engines. We believe that the proposed amendments are an
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1 important step forward in further reducing emissions from
2 small off-road engines.
3 We also commend the ARB staff for its technical
4 report that reflects a comprehensive and balanced analysis
5 of the issues presented by this proposed rulemaking and
6 for staff's willingness to work cooperatively with all
7 interested stakeholders.
8 I'd like to specifically talk about the issue of
9 applying catalysts to non-handheld applications as covered
10 by the staff presentation.
11 MECA strongly concurs with the staff analysis and
12 conclusion that the proposed hydrocarbon and NOx emission
13 standards for these engines are technologically feasible.
14 In fact, we were ready to stand here and say that they
15 were technologically feasible even with the proposal that
16 was contained in the original staff report at the 8 and 6
17 grams.
18 And I think the test results that were generated
19 at Southwest Research Institute also indicate that even
20 those lower levels are technologically feasible and can be
21 reached with the application of catalyst technology to
22 non-handheld engines.
23 I'd also like to take a minute to talk about the
24 issue of thermal management or the safety issues around
25 dealing with high exhaust temperatures. This issue of
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1 heat management that has been raised by the industry is,
2 as Mr. Cackette indicated in his remarks, a
3 straightforward engineering challenge that is well
4 understood and can be readily addressed. These types of
5 issues have been raised virtually every time the use of a
6 catalyst technology has been proposed for use on a
7 spark-ignited engine, whether it be 30 years ago when
8 catalysts were first talked about on cars or more recently
9 with catalysts on applications such as motor cycles or
10 mopeds or forklift trucks or small handheld engines.
11 In each case, all of these issues were
12 successfully addressed for each application. The
13 situation we feel is no different here for these
14 non-handheld engines.
15 Indeed, 30 years of catalyst experience in
16 general and over 10 years experience with applying
17 catalysts to small engines provide an experience base that
18 has enabled catalyst technology to continue to be improved
19 and has provided an increasing understanding of how to
20 optimize the engine catalyst exhaust system to work
21 effectively in these situations.
22 Two striking examples of this type of success in
23 dealing with thermal issues can be gleaned from the fact
24 that more than 15 million two-stroke motorcycles and
25 mopeds worldwide have been successfully equipped with
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1 catalysts and dealt with thermal management issues. As
2 well as more than a million small handheld pieces of
3 equipment using two-stroke engines, that again have been
4 successfully integrated with catalysts without causing any
5 safety-related issues.
6 So, again, I'd just like to commend the staff for
7 the fine work they've done here. I'd also like to commend
8 the engineers at Southwest Research Institute for the fine
9 job that they did in completing this test program.
10 And in closing, again I would like to commend the
11 Board for its leadership in reducing emissions from these
12 small engines.
13 CHAIRPERSON LLOYD: Thanks very much.
14 No questions?
15 Thank you.
16 Rick Bell, Don Anair, Jeff Arnold.
17 MR. BELL: If it's acceptable for the Board, I
18 have approximately six slides I'd like to present to help
19 substantiate some of the information I'll be discussing.
20 (Thereupon an overhead presentation was
21 Presented as follows.)
22 MR. BELL: My name is Rick Bell. I'm a
23 development manager with the Dupont Company.
24 Dupont is a polymer and elastomer supplier. We
25 supply a lot of the -- excuse me just a second.
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1 (Thereupon a discussion was held off
2 the record.)
3 MR. BELL: Should I take a -- should I let the
4 next person go ahead of me, and then I'll --
5 CHAIRPERSON LLOYD: How long, Victoria, is this
6 going to be?
7 Does anybody not have overheads here? What about
8 Don?
9 Yeah, maybe Don can fill in while --
10 MR. BELL: I was considering it more for the
11 audience rather than the staff, because some of these
12 technologies --
13 CHAIRPERSON LLOYD: Then let's hold on then.
14 Maybe Don can come up and -- yeah. And when we
15 get this fixed, we'll --
16 MR. ANAIR: Good afternoon.
17 CHAIRPERSON LLOYD: Good afternoon.
18 MR. ANAIR: My name is Don Anair and I'm with the
19 Union of Concerned Scientists. And I'd like to express
20 our support of the rule proposed by the staff.
21 Off-road engines in California are becoming a
22 significant source of air pollution, as on-road cars and
23 trucks are required to meet tighter emission standards.
24 With existing regulations, off-road hydrocarbon and
25 nitrogen oxide emissions in California are expected to
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1 become 60 percent of total California mobile source
2 emissions by 2020, compared to 37 percent in the year
3 2000.
4 Cleaning up smaller engines that have high
5 emissions is critical to meeting California clean air
6 goals and SIP commitments. The potential savings from
7 this rule are quite significant. According to the staff's
8 estimates -- original estimates, the reductions of
9 hydrocarbons and nitrogen oxide achieved by 2020 would be
10 equivalent to removing 1.8 million cars from California's
11 roads. These are the pollutants that are directly
12 responsible for producing urban ozone. Nine out of ten
13 Californians live in areas that do not obtain the national
14 ambient air quality standards for ozone.
15 California has the authority to clean up small
16 off-road engines and should do so for the health of all
17 Californians.
18 While we support this rule as proposed by the ARB
19 staff and agree that it will achieve significant emissions
20 reductions, zero-emissions equipment should be more
21 strongly encouraged. Electrical equipment in this
22 category can be and is used in many applications and
23 offers clear emissions benefits over combustion engine
24 equipment. A strong zero emission component will achieve
25 emissions benefits above and beyond the proposed
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1 regulation.
2 We urge the Board to adopt the proposed
3 strengthened emissions requirements proposed today by the
4 staff for small off-road engines to benefit the health of
5 all Californians. We also urge the Board to direct ARB
6 staff to investigate and propose a future amendment to the
7 regulation that strongly promotes the manufacture and use
8 of zero-emissions equipment.
9 I'd like to thank the Board for the great job
10 they've done in proposing the original and the amended
11 proposal.
12 Thank you.
13 CHAIRPERSON LLOYD: Thanks very much.
14 We're still out of action, I guess.
15 We're not. Okay.
16 So maybe, Rick, you could come back.
17 And then we'll have Jeff Arnold and Tom Addison.
18 (Thereupon an overhead presentation was
19 Presented as follows.)
20 MR. BELL: I guess sometimes new technology
21 doesn't always work well.
22 But, again, I'm Rick Bell. I'm a development
23 manager with Dupont. And Dupont is a polymer and
24 elastomer supplier for this supply chain, small off-road
25 engines. We supply materials that are commercially used
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1 today. We also supply materials and technology that could
2 be part of a solution to meet the new proposed
3 recommendations.
4 Really my testimony here today is to help
5 validate a lot of the information that Jim Watson
6 presented. But what I'd like to do is to add a few more
7 comments to some of that, addressing some of the concerns
8 that have come up in past workshops around some of these
9 new materials or ways of meeting lower evap limits.
10 --o0o--
11 MR. BELL: The area where Dupont has expertise is
12 in fuel tanks -- plastic fuel tanks, excluding the
13 diurnal. Although when you look at the diurnal, Dupont
14 does also supply nylon for the canisters, fuel lines, and
15 engine seals. So I'm specifically going to discuss these
16 components. I am not going to talk about exhaust
17 emissions.
18 --o0o--
19 MR. BELL: One of the potential solutions we see
20 for blow molded polyethylene fuel tanks is a technology
21 called Selar RB. It's a very simple solution to make a
22 low permeable polyethylene fuel tank.
23 Basically Selar is an additive which is added to
24 polyethylene. It's used extensively today in the
25 automotive industry and for packaging industry, for things
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1 like hazardous chemicals. It's approved also by CARB as a
2 low-perm technology barrier resin for portable or jerry
3 can plastic fuel tanks.
4 --o0o--
5 MR. BELL: Again, this is -- it's patented
6 technology. But basically it involves just adding 7
7 percent of a barrier resin to your polyethylene and you
8 would blend it in-line. And it can reduce permeation over
9 the straight polyethylene by a factor of 95 percent. It
10 requires very little capital investment. Basically a new
11 screw is required in your blow molding machine, but that's
12 all the investment requires.
13 We're looking at the upcharge for this type of
14 technology as being less than 75 cents per tank for a tank
15 on the size of approximately one and a half liters, which
16 is roughly one and a half quartz. So this is very easy
17 technology to implement.
18 Some of the concerns raised at past workshops
19 have been that this technology will reduce the impact
20 strength of a polyethylene fuel tank. And while, in fact,
21 that is true, when you look at the other applications
22 where this is used, such as automotive fuel tanks and
23 hazardous chemicals, these applications require an impact
24 test where you drop a tank from six meters at minus 40
25 degrees C filled with water and glycol, and these
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1 polyethylene tanks will bounce off concrete at those
2 conditions. So while there is a small reduction in impact
3 strength, that reduction can be managed by a modification
4 of the pinch off. Again, these are relatively simple
5 things that can be done to be in compliance.
6 --o0o--
7 CHAIRPERSON LLOYD: That's it?
8 MR. BELL: No.
9 And this just shows here a comparison of Selar
10 versus other alternatives to reduce permeation. Again,
11 what this is highlighting is Selar is one solution. You
12 also have a solution using fluorination or sulfonation or
13 core extrusion. These are all viable technologies.
14 We believe though that one area we don't directly
15 address here is rotomolded polyethylene fuel tanks. For
16 that specific application we believe a fluorination or a
17 sulfonation process would be a very practical solution.
18 --o0o--
19 MR. BELL: And I don't think I'm pointing the
20 clicker at the right machine to get it to -- just point up
21 here?
22 Okay. The other solution for plastic fuel tanks
23 is to simply look at a different base resin. CARB has
24 done a lot of testing with nylon. And that's because
25 nylon plastic fuel tanks for small off-road engines are
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1 used today. So, again, this is commercial technology that
2 already is in compliance with low evap requirements.
3 In addition to nylon, you could also look at
4 acetone as an alternative material.
5 Again, these products will tend to have lower
6 impact strength versus polyethylene. But they will also
7 tend to strengthen and stiffen the tank. So if you're
8 looking at situations where you might have slight
9 pressurization, a change of material will help in
10 preventing too much ballooning of the tank.
11 There could be some questions with shrinkages.
12 You may need some new tooling. But, again, we look at
13 this for a one and a half liter tank as the upcharge being
14 less than $2.25 to have a low-perm solution.
15 --o0o--
16 MR. BELL: Another area I'd like to address is
17 low-perm plastic fuel lines. We --
18 CHAIRPERSON LLOYD: How long are you going to go
19 on?
20 MR. BELL: Five minutes.
21 CHAIRPERSON LLOYD: You mean -- you've already
22 had ten.
23 MR. BELL: Okay.
24 CHAIRPERSON LLOYD: I think -- let's cut it.
25 MR. BELL: Okay. Again, I don't think there's
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1 any question around low-perm plastic fuel lines. One
2 point I would like to add is the new proposal looked at a
3 15-gram-per-square-meter limit. There are technologies
4 out there such as F-200 from Moldex which can actually
5 reduce that below 5. So there are even lower perm
6 alternatives commercially used today.
7 --o0o--
8 MR. BELL: Again, engine seals, there are
9 low-cost solutions. This is commercial technology which
10 is used in other applications today, easily appliable to
11 this market.
12 --o0o--
13 MR. BELL: So that is in brief I guess all we
14 wanted to present. Again, just substantiating the numbers
15 we see that CARB has presented, we do believe those are
16 valid numbers and this is technology easily implemented.
17 CHAIRPERSON LLOYD: Oh, that's the measure.
18 That's excellent. Again, thank you very much.
19 Any questions from the Board?
20 Thank you very much.
21 We're going to take a five-minute break for the
22 court reporter before we get to the home stretch here.
23 So let's get back at 5:15 by that clock there.
24 (Thereupon a recess was taken.)
25 CHAIRPERSON LLOYD: We commence with Jeff Arnold,
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1 Tom Addison, Todd Campbell.
2 MR. ARNOLD: Good afternoon.
3 Chairman Lloyd and Board members, thank you for
4 giving me the opportunity to speak to this group. My name
5 is --
6 CHAIRPERSON LLOYD: Yeah, we've got a couple of
7 Board members listening in the back, by the way. There
8 are -- you can hear them back there -- they can hear you.
9 MR. ARNOLD: Thank you.
10 CHAIRPERSON LLOYD: There's speakers back there.
11 MR. ARNOLD: So I don't have to talk real loud
12 then, right?
13 CHAIRPERSON LLOYD: Well, you still have to talk
14 loud. No, not loud though.
15 BOARD MEMBER DeSAULNIER: Just don't have your
16 cell phone go off.
17 (Laughter.)
18 MR. ARNOLD: No, it plays a different tune, I
19 play, than hers, so we're okay.
20 (Laughter.)
21 MR. ARNOLD: My name is Jeff Arnold, and I am the
22 Executive Director and CEO of the Association of
23 Rotational Molders International, which is based in Oak
24 Brook, Illinois, outside suburban Chicago. Our
25 association represents over 350 rotomolders and
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1 rotomolding material and equipment suppliers in 60
2 countries around the world, with 15 rotomolders in
3 California alone.
4 The vast majority, around 90 percent, of U.S.
5 rotomolders are small, privately-held companies with a
6 single plant and four to five rotational molding machines.
7 Most of our members fall in to the Category 2 or 225 cc
8 greater category.
9 I'd like to address my comments briefly to two
10 issues that arise in connection with CARB's proposed
11 regulation, keeping them specifically to limiting
12 evaporative emissions from small off-road equipment fuel
13 tanks.
14 The exhaust issue is not applicable to our
15 industry. We are in the plastics field.
16 One is CARB's contention that rotomolded fuel
17 tanks on SORE can be cost effectively and safely replaced
18 with units made from metal or alternative plastic
19 processing methods. And, two, the damage to the U.S.
20 rotomolding industry on their material and equipment
21 suppliers if this important market were to be limited or
22 lost due to these proposed regulations.
23 The study, conversion from steel to plastic fuel
24 tanks over the recent past, satisfies a number of economic
25 mandates from the marketplace as well as the environmental
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1 mandates coming from federal and state agencies, to wit:
2 Longer life expectancy, enhanced safety, enhanced
3 flammability resistance, parts consolidation, greater
4 design freedom, weight savings, corrosion resistance, and
5 sound dampening.
6 The reason why rotomolding is preferred in small
7 scale SORE fuel tanks relates to rotomoldable plastic
8 material options, the nature of the process, and the total
9 cost burden of the process.
10 Rotomolders can utilize cross-linked
11 polyethylene, which as a thermal setting plastic, is quite
12 rigid and its mechanical properties are not heat
13 sensitive.
14 Second, rotomolding yields a part with uniform
15 thickness. Third, machine and cast rotomolds and
16 rotomolding machines are lower in cost. And, fourth,
17 rotomolding is the ideal process for low-volume hollow
18 part production, and has a significant presence in SORE
19 fuel tank businesses.
20 In closing, since 2000 the U.S. economy has
21 suffered through economic conditions. Here in 2003 there
22 are signs of economic recovery, yet it is turning out to
23 be a jobless recovery. It would be both untimely and
24 unfortunate if these proposed regulations impact adversely
25 on a sector of the plastics industry that provides jobs
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1 and plants here in California, especially southern
2 California.
3 Rather than contemplating the replacement of
4 rotomolded SORE fuel tanks, we feel that CARB should
5 consider providing incentives to regional rotomolders to
6 explore technological changes in material, machinery, and
7 processing methods, would make a highly cost-effective
8 product even better.
9 And I'd like to add just at the very end of the
10 comments that historically -- our association is 28 years
11 old this year. And historically we have been -- our main
12 mission is to promote the industry in the process. So we
13 are not typically involved in this type of process. And
14 we would be happy to work, you know, with the CARB Board.
15 This came to our attention from a couple of our members
16 just within the last 30 days. And that is why we have not
17 been here previously.
18 So thank you very much.
19 CHAIRPERSON LLOYD: Thank you for coming. And
20 I'm sure staff will work with you on these issues.
21 MR. ARNOLD: All right. Thank you.
22 CHAIRPERSON LLOYD: Thank you very much.
23 Tom Addison.
24 I didn't see Tom. That's okay.
25 Todd Campbell.
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1 No Todd.
2 Jim Medich.
3 BOARD MEMBER DeSAULNIER: For Tom Addison. After
4 five Bay Area Air Districts, the employees don't work.
5 So --
6 (Laughter.)
7 BOARD MEMBER DeSAULNIER: -- he'll be happy to
8 hear that. They're out watching the sunset in the hot tub
9 or something.
10 (Laughter.)
11 MR. MEDICH: Chairman Lloyd, members of the
12 Board. I'm Jim Medich. I'm a fire division chief with
13 the West Sacramento Fire Department.
14 I'm here today representing the California Fire
15 Chief's Association. That organization is comprised of
16 fire Chiefs from over 1,100 fire departments in
17 California.
18 The California Fire Chiefs Association is
19 concerned that the California Air Resources Board's plan
20 to require installation of high efficiency, hot catalytic
21 exhaust systems on lawn and garden equipment could
22 increase the risk and severity of operator burns and wild
23 land fires. Also, they could have associated problems
24 with refueling fires and fires in garages after the hot
25 equipment is stored after use.
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1 It appears that most of our concerns from the
2 July 2nd meeting that I attended have been addressed in
3 the alternative standards that were presented today. Cal
4 Chiefs would like more time to study the new changes to
5 see how their impacts would affect fire safety.
6 As we have stated before, the California Fire
7 Chiefs Association would welcome the opportunity to work
8 with other safety experts to address the unresolved safety
9 issues to ensure that the citizens of California are
10 getting not only the best environmental policy, but also
11 the best safety policy we can give them.
12 I'd be glad to answer any questions.
13 CHAIRPERSON LLOYD: Professor Friedman.
14 BOARD MEMBER HUGH FRIEDMAN: We -- I don't know
15 if you're familiar with our process. But if we adopt this
16 proposal today, with some modifications, there's still a
17 15-day period in which we receive additional information
18 and comment. And I'm wondering if you can't give us
19 further input if there is any additional concern or
20 further concern in that period of time.
21 MR. MEDICH: I think that'd be reasonable.
22 BOARD MEMBER HUGH FRIEDMAN: Am I correct on
23 that?
24 EXECUTIVE OFFICER WITHERSPOON: You're quite
25 right. It also takes as an amount of time to put together
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1 the package for 15-day changes. So there is a month or so
2 of time even before that goes out where we can be talking
3 and meeting and the fire chiefs can do their evaluation.
4 And then we'll have actual regulatory language for them to
5 look at.
6 BOARD MEMBER HUGH FRIEDMAN: Yeah, these rules
7 don't go into effect themselves by their own terms for a
8 while. So there's a lead time. But we don't want to
9 unduly delay. On the other hand, I for one want to be
10 sure that we have got the full benefit of the
11 professionals on this safety question.
12 CHAIRPERSON LLOYD: Thank you. And, again, your
13 comments are very helpful. And I think staff has looked
14 through and addressed the safety issue as far as we could
15 see very well. And the fact that Honda indicated they
16 don't see a major issue there, also that's very helpful.
17 But we really appreciate your comments. Look
18 forward to working with you to make sure that we do
19 everything we can to mitigate that.
20 MR. MEDICH: Thank you, sir.
21 CHAIRPERSON LLOYD: Thanks very much for coming.
22 Dave Modisette and Jed Mandel.
23 MR. MODISETTE: Yes, thank you, Chairman Lloyd,
24 members of the Board. I'm Dave Modisette. I represent
25 the California Electric Transportation Coalition.
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1 Although I'm here to present a position statement that
2 includes seven other organizations: The American Lung
3 Association of California, the Center for Energy
4 Efficiency and Renewable Technologies, the Coalition for
5 Clean Air, the Natural Resources Defense Council, the
6 Steven and Michele Kirsch Foundation, the Sierra Club, and
7 the Union of Concerned Scientists.
8 We strongly support CARB's proposed rulemaking to
9 strengthen exhaust and evaporative emission control
10 requirements for small off-road equipment and engines.
11 The proposed measure, if adopted, would be a significant
12 step towards achieving California's clean air goals and
13 would provide essential public health benefits for all
14 Californians. In addition to supporting the adoption of
15 the regulation, we urge the Board to commit to a future
16 rulemaking that would encourage the sale of zero emission
17 equipment in this category.
18 Off-road engines in California are responsible
19 for a significant amount of air pollutants and
20 traditionally have not been held to the same emission
21 standards as on-road engines.
22 Under the current regulations, off-road engines
23 are expected to account for more than 60 percent of
24 California's total mobile source hydrocarbon and nitrogen
25 oxide emissions by 2020, compared to only 37 percent in
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1 the year 2000.
2 There is a clear need to address the increasing
3 significance of off-road engine pollution in California.
4 The proposed regulation for reducing exhaust and
5 evaporative emissions from small off-road engines and
6 equipment is the necessary step in reducing air pollution
7 from these engines.
8 While we support the adoption of the rule as
9 proposed by the staff, we would also like a commitment by
10 the Board to promote the adoption of zero emission
11 equipment in a future rulemaking. The current regulation
12 has no provision for either encouraging the use or sale of
13 electric powered zero emission equipment. And maybe just
14 as a footnote I should say that this is based on the
15 August 8th staff proposal. It does not include any
16 changes that were presented today. I did see a reference
17 to zero emission equipment in the staff presentation
18 today, and I think we'd like to learn more about that.
19 The August 8th, 2003, CARB staff report describes
20 the benefits of zero emission technology in this category.
21 I won't repeat that here. The staff report also states
22 that electric powered handheld equipment was readily
23 available for the residential user market. This equipment
24 includes both cordless and corded models of line trimmers,
25 hedge trimmers, leaf blowers, chain saws, tillers, and
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1 lawnmowers.
2 Markets for much of this electrical equipment are
3 already well established. For example, electric mowers
4 are estimated to be about 10 percent of the California
5 market according to the staff report.
6 Manufacturers should be encouraged and rewarded
7 for increasing their proportionate sales of zero emission
8 equipment in California. This could be accomplished in
9 several ways. But the use of a manufacturer's fleet
10 average standard that includes zero emission equipment
11 sold by manufacturers in California may provide the best
12 combination of additional emissions reductions and
13 compliance flexibility.
14 This fleet average concept is not included in the
15 rulemaking that is before you today, and will take
16 additional work to develop. Further, the fleet average
17 concept is not incompatible with the minimum ICE standards
18 proposed by staff in the rulemaking before you.
19 We urge the Board to direct staff to begin work
20 to develop a fleet average construct or other mechanism
21 that includes and encourages zero emission equipment in
22 these small off-road categories. This construct would be
23 subject to the rulemaking process and should have an
24 appropriate implementation lag to provide compliance
25 flexibility.
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1 In order to develop the fleet average construct,
2 staff needs to have information on the annual sales of
3 zero emission equipment and on the existing inventory of
4 the equipment. We do not know if staff has this
5 information or has a current means of getting it. It may
6 be that a reporting requirement is needed whereby
7 manufacturers report their annual sales of zero emission
8 and other equipment within the small off-road category.
9 The Board should consider this issue today.
10 In conclusion, the proposed rules are
11 technologically feasible, as shown by the staff, and will
12 achieve cost effective emissions reductions from small
13 off-road equipment. We urge the Board to adopt the rules
14 as proposed for the benefit of all Californians. We also
15 urge the Board to direct staff to begin work to include
16 zero emission equipment in the regulatory framework for
17 small off-road equipment in a way that encourages and
18 rewards manufacturers for increasing their proportionate
19 sales of this equipment and reducing emissions even
20 further than required by the currently proposed
21 regulations.
22 Thank you.
23 CHAIRPERSON LLOYD: Thank you, Dave. And I think
24 we would support that. Maybe staff can look at the zero
25 emission. And that would include push mowers, too.
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1 EXECUTIVE OFFICER WITHERSPOON: We did evaluate
2 the issue of electric power equipment to as much as we
3 could during the process of this rulemaking. And we were
4 unable to arrive at either a regulatory approach -- well,
5 we were unable to arrive at a regulatory approach that we
6 believed would work.
7 And the fleet average, which sounds so
8 compellingly simple, does not work easily in this market
9 where there's both integrated and non-integrated equipment
10 and against whom is the fleet average levied and who's
11 held responsible for that.
12 So we also encountered a barrier with the
13 difference between residential and commercial users going
14 to the same retail site, and could not think of a way to
15 prevent a residential user from walking away from that
16 site with a fuel-power piece of equipment that when they
17 arrive there they're only allowed to purchase an electric.
18 So our tentative conclusion is that an
19 incentive-based strategy on electric is ultimately going
20 to be more successful. And to the extent the Board wants
21 us to keep endeavoring in this area, we would hope you
22 would say not to come back certainly with a regulation
23 because we're still not sure that's feasible, but instead
24 to come back with recommendations on how it is we should
25 increase the penetration of electric equipment. It's just
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1 a very complicated issue.
2 And we support completely the goal of doing it.
3 But we couldn't figure out how in this regulation, and
4 that's why it isn't here. And it wasn't just a matter of
5 time. Give us six more months and we'll tell you how we
6 think there's some fundamental issues about trying to do
7 it through a regulatory method.
8 CHAIRPERSON LLOYD: Professor Friedman.
9 BOARD MEMBER HUGH FRIEDMAN: Well, Ms. D'Adamo
10 mentioned it earlier. And I whispered to her, "I like the
11 idea." I wonder if it wouldn't be productive for Mr.
12 Modisette to meet with staff and, as staff continues, to
13 see what could incentivize zero emission equipment of this
14 sort, and whatever else you can come up with.
15 I don't know that it should be then part of this
16 rulemaking. But it could always be a separate but related
17 proposal later.
18 EXECUTIVE OFFICER WITHERSPOON: We'd be happy to
19 talk to him about it. Maybe he's got some --
20 BOARD MEMBER HUGH FRIEDMAN: Could we put some
21 time on it? Six months?
22 EXECUTIVE OFFICER WITHERSPOON: Sure, for a
23 report back. I just didn't want to promise you we could
24 get back here with a regulation.
25 BOARD MEMBER HUGH FRIEDMAN: No, I understand.
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1 But a concept and a recommendation that --
2 EXECUTIVE OFFICER WITHERSPOON: Sure.
3 BOARD MEMBER DeSAULNIER: We have a model.
4 Go ahead, Didi.
5 BOARD MEMBER HUGH FRIEDMAN: So do we keep it on
6 our agenda?
7 BOARD MEMBER DeSAULNIER: No, no. We were
8 thinking about maybe an MOU that would just be required.
9 They'd agree to sell, say, 10 percent, 20 percent of
10 their --
11 (Laughter.)
12 CHAIRPERSON LLOYD: Well, I think Dave has
13 been --
14 BOARD MEMBER DeSAULNIER: Worked so well last
15 time.
16 (Laughter.)
17 CHAIRPERSON LLOYD: Dave has been very helpful, I
18 think, in creative -- in bringing stuff before the Board.
19 So that would be very good.
20 And, Didi, you've got a better suggestion?
21 BOARD MEMBER D'ADAMO: Well, no, not that I have
22 a better one. But I just think -- you know, we push so
23 hard on cars, which was so much more difficult. The
24 technology is definitely there. We know it. And I can
25 see why there would be issues with a fleet average
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1 concept. But I'm kind of thinking that the
2 incentive-based program is not, you know, far enough.
3 So we'd just be hopeful that staff could remain
4 open to some of these other concepts, and flexible. And,
5 again, I suggest that you work with Dave's groups. I'd be
6 happy to join in the effort as well. I feel pretty
7 strongly about this.
8 EXECUTIVE OFFICER WITHERSPOON: In terms of
9 timing -- I just chatted with Mr. Cackette -- six months
10 seems like about the right amount of time to report back
11 to you on where that stands, if that's amenable to you
12 all.
13 CHAIRPERSON LLOYD: Can we offer any incentives
14 to shorten that?
15 (Laughter.)
16 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Three
17 more staff.
18 (Laughter.)
19 CHAIRPERSON LLOYD: Good call.
20 And, by the way, I realize how tough it's been
21 and how much there is on the staff's plate. So I respect
22 that. And I was only kidding.
23 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: And I
24 didn't mean to be -- adjust either. But, you know,
25 there's quite a bit of work following up on this Board
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1 meeting should you approve this regulation. And they have
2 to do that work first to make sure we get through the
3 process, so --
4 CHAIRPERSON LLOYD: I agree.
5 Thanks very much, Dave.
6 MR. MODISETTE: That sounds very good. I've
7 already had -- you know, Tom and I and Bob Cross have
8 already had some discussions on this. So, yes, I'd very
9 much like to work with staff on this.
10 CHAIRPERSON LLOYD: Great. We really appreciate
11 your offer to help there.
12 Jed is now so much smarter than he was earlier
13 on. So we've got the benefit of that wisdom.
14 MR. MANDEL: Of course that's not saying very
15 much.
16 BOARD MEMBER HUGH FRIEDMAN: Clean-up batter.
17 MR. MANDEL: What I was going to say is the real
18 reason why I wanted to go last was for once you'd be
19 pleased to see me come up here.
20 CHAIRPERSON LLOYD: By the way, I didn't like
21 your suggestion to address this safety issue a little more
22 is that in fact we require your operators to provide
23 asbestos gloves for the operation of the equipment.
24 MR. MANDEL: Well, I'm investing my stock --
25 maiden stock in that asbestos company right now.
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1 Good afternoon, almost good evening.
2 Again, my name is Jed Mandel. I'm here today on
3 behalf of the Engine Manufacturers Association. And as I
4 think you know, EMA's members include the principal
5 manufacturers of the Class 1 and Class 2 non-handheld
6 spark-ignited engines for the subject of today's proposal.
7 We believe that further exhaust and evaporative
8 emission reductions can and should be implemented in
9 California. And we are committed to do so. But we cannot
10 support the original staff proposal that was incorporated
11 in the mail-out.
12 Instead, we developed an alternate proposal that
13 would provide California the same benefits as it would
14 have achieved under the staff's proposal at a far lesser
15 cost, with substantially less burden and disruption to the
16 industry, in a manner that is practical, realistic, and
17 enforceable.
18 Two days ago the staff provided us with the
19 outline of an alternative program that is similar but not
20 identical to what we proposed. In fact, it proposes some
21 programs that go beyond what we asked for. And I might
22 add, it is completely different from and not within the
23 scope of the original staff proposal that was part of the
24 mail-out package.
25 No details have yet been developed on how the
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1 staff's alternate program would work and no draft
2 regulatory language has yet been developed.
3 There are complex, innovative, and challenging
4 aspects of the staff's proposal that cannot fully or
5 properly be assessed without a modest amount of additional
6 time. Based on the staff's representations, we think we
7 might be close. But we do not yet have enough of the
8 critical details to know whether we can reach an agreement
9 for sure.
10 The failure to reach an agreement today, that we
11 can stand up here and represent we already have, is simply
12 the result of running out of time. Admittedly, the
13 industry originally advocated regulatory concepts quite
14 different from that which we proposed to the staff. And
15 the staff only had a few weeks to assess our recent
16 proposal.
17 Now, we only have really a couple of days, and in
18 some detail only a couple of hours, to assess the staff's
19 outline of its proposal, and without knowing the critical
20 details.
21 I know Professor Friedman asked earlier -- and
22 I'm going to try and anticipate your question -- as what
23 some of the examples are of where they're not necessarily
24 aligning up.
25 I represented to you that in one case the staff's
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1 proposal provides more than what the industry asked for.
2 And when I say the industry, I'm talking about the
3 EMA/OPEI proposal. And the area of concern there is the
4 fleet averaging program. As many of you know, and I know
5 as the staff knows, because we've worked on these programs
6 over the years, EMA and its members historically are
7 advocates of averaging programs. And, in fact, we're
8 interested in exploring this averaging program.
9 But one of the things that we've always found
10 interesting in our internal discussions and interesting in
11 some of our discussions with regulators is that averaging
12 programs have the potential for creating an unlevel
13 playing field if they're not very carefully developed.
14 This is an averaging program, or at least a concept, that
15 developed without any input from any of the Engine
16 Manufacturers Association's members or obviously from the
17 Association itself. And, candidly, we're a little
18 concerned that it doesn't play out in a way that creates
19 an unlevel playing field between competitors.
20 I'm also -- was mindful of the comment about the
21 interest in electric mowers and in push mowers. And it
22 strikes me that it would not be in the Board's best
23 interests if at the end of the day the fleet averaging
24 program would allow an engine manufacturer and equipment
25 manufacturer to package up a relatively inexpensive push
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1 mower in with their regular spark-ignited internal
2 combustion engine and claim on average it was not having
3 very many exhaust or evaporative emissions.
4 So I think averaging programs, while they're
5 interesting, have a lot of, as the classic phrase goes,
6 "Devil in the Details" that we're very concerned about,
7 and we think you as a Board ought to be concerned about.
8 Another area that was new to us is the compliance
9 validation plan that's just referenced again at the end of
10 the staff's proposal. We don't know what that means. We
11 don't know how it will work. Obviously, we have an
12 opportunity through the 15-day notice process to work out
13 those issues. But we are very concerned that in fact when
14 the staff represents to us that their proposal is exactly
15 what we've asked for, then in fact we may be talking past
16 each other since that program starts to look like an
17 individual manufacturer's year-by-year, sort of zero -- of
18 summing to zero individual compliance program as opposed
19 to an alternate industry-wide program not requiring
20 individual engine manufacturer demonstrations of
21 compliance for the manufacturer as opposed to the
22 industry. Again, we may be talking past each other. I
23 don't know.
24 There's also a very important requested-for
25 requirement of demonstrating equivalents on the running
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1 loss cannister issue. We totally support that. We're
2 very appreciative of the staff's proposal. We just don't
3 know how it's going to work. And, again, a very, very
4 important detail.
5 There are also other areas that provide some
6 uncertainty or where it doesn't appear yet that what the
7 staff has represented as their alternative proposal is
8 exactly what the industry asked for. You've already heard
9 about the issue of defining the program in such a way that
10 its limits are only for the benefit of the State of
11 California. I'm not going to raise that up early, except
12 it is a point of some difference.
13 There's also a very important difference on the
14 enforcement side of the program. We very carefully
15 suggested to the staff, as I think the staff acknowledged
16 earlier in their own report, that the practicality of a
17 mandatory recall for a consumer product like lawnmowers,
18 unregistered in many cases at least in the high volume
19 cases, considered a throwaway product, it's just not a
20 very practical way to enforce the program.
21 Right now that's the only authority that's
22 provided in the package. And we have suggested that
23 EPA -- excuse me -- that ARB align itself more in the way
24 EPA does the enforcement program, which does suggest a
25 whole realm of enforcement options, with recall being
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1 recognized as one that is not practical.
2 I'm also frankly a little concerned in terms of
3 the staff proposal, in understanding it, in that there's
4 an exhaust component -- which, by the way, we support.
5 Those are the numbers that we asked for. And, by the way,
6 a perfect example of changes that would be easily handled
7 in a 15-day notice. They're not very complex, very
8 understandable, and ones that we support.
9 As I understand the way it's being proposed
10 though, those exhaust numbers would now be paired with
11 three options for compliance with the evaporative side:
12 The original staff proposal, Alternate 1, and Alternate 2;
13 with Alternate 1 and Alternate 2 being evaporative
14 proposals specifically designed to provide
15 over-achievements on the hydrocarbon evaporative emission
16 side to balance out some of the shortfall on the exhaust
17 side.
18 But the original staff proposal doesn't have any
19 over-exceedance on the evaporative emission program. And
20 I believe that the August 8th mail-out, that evaporative
21 emission program, paired with the exhaust proposal that we
22 heard from the staff today, in fact would result in a
23 significant ton shortfall for California. And I believe
24 if you adopt that today, that becomes the law, and
25 manufacturers could choose that route. I don't think
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1 that's what the Board intends.
2 We are committed to working with you and the
3 staff to assure that real emission reductions are achieved
4 in a cost-effective and timely manner. I am requesting
5 that we have modest additional time that would be required
6 for us to address these issues that I've noted today,
7 issues that, by the way, I'm very optimistic can be
8 addressed. And we'd like to do so in a process that
9 assures openness in a board hearing so that we're not
10 surprised as part of a final 15-day rule -- the rule
11 finalized as a result of the 15-day process, that other
12 new issues have surfaced that we never really had a chance
13 to comment on or report back to you on.
14 I do know because I've had a chance to talk to
15 staff throughout the course of the day, and I've had a
16 chance to talk briefly with Dr. Lloyd today, that there is
17 a great deal of obvious interest on the part of the Board
18 of adopting a rule today. I understand that.
19 I do think that the process issues and the real
20 issues that I've noted today do suggest that, again,
21 putting this over to December -- I might add, by the way,
22 that this industry has a history of having rulemakings at
23 Christmas time with the Board. We'd love to come back out
24 here when it's cold in the midwest. But putting this off
25 to December we don't think will put any delay in terms of
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1 implementation of the rules.
2 And the only other thing I'd say, in anticipation
3 perhaps of the Board's, as I said, reluctance to do
4 that -- although that is what we're asking for -- is
5 perhaps as an alternative to think about, first of all,
6 providing more than 15 days. The 15-day process, as I
7 understand California law, only says 15 days minimum. You
8 can provide more time. And also to put on your calendar
9 for December this item so that if it turns out that there
10 is difficulty in trying to get this rule resolved through
11 a staff process, that we have an opportunity in a timely
12 fashion without delay and without turning to any
13 acrimonious process to come back to the Board so we can
14 get closure on this and start producing product to the
15 clean standards that you will have adopted.
16 Thank you very much for your time.
17 CHAIRPERSON LLOYD: Thank you very much, Jed.
18 You raised a number of issues there.
19 Professor Friedman.
20 BOARD MEMBER HUGH FRIEDMAN: I think I heard
21 earlier the need for certainty. And I'm wondering if this
22 isn't -- to me it sounds very familiar, the list of open
23 questions about how it would work, precisely what the
24 details are, which is typically what we have our 15-day
25 notice for as long as the basic principles and concepts
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1 are the policy, as opposed to all the procedures. And I
2 know that the Devil is in the details sometimes. But we
3 rarely have ever adopted a rulemaking that is finished
4 with every comma and every period when we act, as opposed
5 to under the 15-day notice. And that allows some time,
6 weeks, for such as the interested parties to work with
7 staff and thrash all this out without our having to do
8 that. And then they report back to us. And if amendments
9 are needed or something, that's a different matter.
10 But is 15 days notice adequate?
11 EXECUTIVE OFFICER WITHERSPOON: We're happy to
12 give them 30. We just did that on the 15-day process for
13 the ZEV regulatory changes, the full 30, recognizing the
14 complexity and how the pieces of the reg interacted with
15 one another. So there's no problem doing that.
16 We would not like to notice this again for
17 December though because it implies that it's coming back
18 to the Board. And I think you can let us determine if the
19 issues are sufficient enough to bring them back.
20 BOARD MEMBER RIORDAN: Mr. Chairman?
21 CHAIRPERSON LLOYD: Yes. Ms. Riordan.
22 BOARD MEMBER RIORDAN: If I heard the staff a
23 little bit earlier, you actually have usually a lead time
24 to the 15- or 30-day period. So you're actually, Jed,
25 getting many more days than the 30 days. And hopefully
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1 that would accommodate your organization and others that,
2 you know, want to work with the staff through the details.
3 So it seems to me a 30-day period is a very realistic
4 period because we know it's actually many more days than
5 appears.
6 MR. MANDEL: If I could, I certainly want to
7 acknowledge that -- both with Mrs. Riordan's comment about
8 how the process really works and with the possibility of
9 that 15-day notice in fact being extended. It addresses a
10 significant part of my concerns, which is just having the
11 time to address complex issues.
12 But in response to Professor Friedman's comment,
13 I also want to remind you one of my concerns isn't just
14 having the time to respond to it, but having an
15 understanding of what this really means in an open process
16 that ultimately has everyone coming before a public
17 hearing and airing the issues.
18 The two proposals that came to the Board today
19 really did not spring out of the original staff proposal.
20 They were quite different. And I have particular concern,
21 as I said, about an averaging program, which may be the
22 solution to the world's problems, but we have not had the
23 chance to work it out. And it's very different than --
24 and I should interrupt myself and say we've done I can't
25 remember how many 15-day notice issues with this Board and
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1 with this staff very successfully. It's a process that
2 works.
3 My concern is that we have not even begun to
4 think about it. This isn't like changing a 10 to an 8.
5 This is in developing a whole new program, that I think in
6 fairness should come back to all stakeholders to hear what
7 it is and comment on it to you.
8 CHAIRPERSON LLOYD: Short of that, what would be
9 optimum?
10 MR. MANDEL: Well, I thought the optimum sort of
11 middle ground, besides the additional time, would be to
12 have a real opportunity, if necessary, to avail ourselves
13 of the Board's hearing in December. And, again, I
14 understand -- I saw Catherine's head move and I heard her
15 loudly before -- but I understand it's not the staff's
16 goal. But I'm concerned that if the staff unilaterally
17 should decide it needs to come back to you, it takes a
18 while to get back on your agenda. We can always pull it
19 off easily.
20 CHAIRPERSON LLOYD: All right. But the other
21 thing, I think if you come back as an information item to
22 see whether we want to go ahead, that's one thing. But I
23 also share staff's concern that we've got to bring this to
24 some closure. And I think we're trying to meet you the
25 way -- and I have a lot of faith, and also as long as I'm
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1 here working with staff to monitor what's going on and sit
2 in on some of these meetings, and my colleagues would be
3 happy to do that also, to make sure that if these are real
4 issues, then we will address them.
5 BOARD MEMBER RIORDAN: Mr. Chairman, if I might,
6 and Mr. Mandel.
7 It seems to me you always have access to our
8 Chairman. And I'm certainly willing to defer to him and
9 his good judgment, that if at the end of all of this
10 period that there are some remaining issues, at some time
11 in the very near future we could maybe undertake some of
12 those. But I trust his judgment, and I think it would be
13 very appropriate for him to hear the issues if you feel
14 there are some left. You may be able to resolve all of
15 them in this almost 60-day period.
16 MR. MANDEL: Well, we hope that. And obviously,
17 not only with all the Board members, but in particular
18 with Dr. Lloyd, we do know that we have access and we
19 would take advantage of that.
20 CHAIRPERSON LLOYD: And, again, I think it's our
21 obligation. And I think, as I said before, we've been
22 trying to work in good faith with the industry. And staff
23 has worked, I know, very hard and diligently. And as you
24 say, it seems a little bit ironic today when staff has
25 tried to incorporate some of those, people saying, well,
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1 we haven't got -- and I understand the details. But I
2 think you've got to also recognize the tremendous effort
3 that's gone on, to recognize the concerns to ameliorate
4 those, to come from where I understood we were just
5 several months ago, to come this close and then have one
6 of the major manufacturers also say that they can live
7 with this provided some of those issues are addressed in
8 that time period. And, again, that's the same thing we'll
9 hold there as we work together. I think that's a
10 tremendous accomplishment and I think staff has done a
11 really excellent job.
12 MR. MANDEL: And obviously you should say that,
13 and I think I should take the time as well. Because in
14 the heat of trying to focus our concerns to the Board's
15 attention, sometimes we neglect to remind ourselves of how
16 far the staff has come.
17 And also the industry. The industry proposal
18 moved substantially from where we were. But I do want to
19 acknowledge the staff's hard work in working with us. I
20 wish we had had more time. I blame some of that on
21 ourselves in terms of working it. I'm hoping that we can
22 get closure and get closure quickly.
23 CHAIRPERSON LLOYD: And you understand, Jed, the
24 same as we were talking this morning or earlier this
25 afternoon, about the item we have next month going to
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1 South Coast and seeing all the pressures down there to do
2 something. I think we would be neglecting our duty to try
3 to keep these on track. But if there is again -- those
4 concerns are not being worked out, then we will surely
5 take those in to account.
6 EXECUTIVE OFFICER WITHERSPOON: There will also
7 be a vote on the Senate floor as to whether the bond
8 amendment in the VA HUD measure should pass. And I think
9 it's important for Congress to understand what the nature
10 of the rule adopted by the Air Resources Board is when
11 they're considering the necessity or not of overruling it
12 through that amendment.
13 CHAIRPERSON LLOYD: Thank you.
14 Thank you very much, Jed. And, again, as always,
15 we appreciate your wisdom and comments there. And we look
16 forward to working with you and your colleagues.
17 MR. MANDEL: Thank you, Doctor, very much. Thank
18 you, Board members.
19 CHAIRPERSON LLOYD: Okay. With that, I guess
20 it's the end of the public testimony.
21 Maybe here we'll have some discussion, and before
22 we go in to ex parte.
23 Yeah. Well, maybe I'll take ex partes.
24 First of all -- well, first of all, I'd like to
25 close the record on this agenda item. However, the record
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1 will be reopened when the 15-day notice of public
2 availability is issued.
3 And will that be 30 days?
4 Is that right?
5 GENERAL COUNSEL WALSH: Yes.
6 CHAIRPERSON LLOYD: Thirty days.
7 So when the 30-day notice of public availability
8 is issued. Written or oral comments received after this
9 hearing date but before the 30-day notices are issued will
10 not be accepted as part of the official record on this
11 agenda item.
12 When the record is reopened for a 30-day comment
13 period, the public may submit written comments on the
14 proposed changes, which will be considered and responded
15 to in the final statement of reasons for the regulation.
16 And, again, just a reminder to my colleagues
17 about policy concerning ex parte communications. While we
18 may communicate off the record with an outside person
19 regarding Board rulemaking, we must disclose the names of
20 our contacts and the nature of contents on the record.
21 This requirement applies specifically to communications
22 which take place after notice of the Board hearing has
23 been published.
24 And, therefore, are there any communications we
25 need to disclose?
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1 Supervisor DeSaulnier.
2 BOARD MEMBER DeSAULNIER: I had one. Tim
3 Flannegan representing the Outdoor Power Equipment
4 Institute met with me yesterday at my office in Concord,
5 California. The discussion was largely consistent with
6 the testimony from Mr. Guerry today. But it was related
7 specifically to the issues of safety.
8 That was it.
9 CHAIRPERSON LLOYD: Ms. D'Adamo, while you're --
10 oh, okay.
11 BOARD MEMBER D'ADAMO: Yes, on September 23rd I
12 had a conference call with Todd Campbell, Coalition for
13 Clean Air; Bonnie Holmes-Gen, American Lung Association;
14 Diane Bailey, NRDC; Patricia Monahan, Union for Concerned
15 Scientists.
16 And the testimony was consistent with the
17 testimony by Dave Modisette this afternoon.
18 CHAIRPERSON LLOYD: Thank you.
19 Mrs. Riordan.
20 BOARD MEMBER RIORDAN: Mr. Chairman, I also had a
21 meeting with Tim Flannegan representing the Outdoor Power
22 Equipment Institute in mid-September. And the discussion
23 revolved around the safety issues and their submittal of a
24 plan to staff. I did not see that plan, nor was it
25 discussed. It was just simply mentioned. And he provided
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1 me with two letters, one from the National Association of
2 Fire Marshals, which we have today, and also a letter from
3 the California Fire Chiefs Association.
4 CHAIRPERSON LLOYD: Mr. Calhoun.
5 On September 27th -- September 22nd and September
6 23rd I had discussions -- telephone discussions with John
7 Dunlap, who was assisting Tim Flannegan on behalf of the
8 Outdoor Power Equipment Institute.
9 And August 25th, 28th, and September 4th, I had a
10 meeting with Kirk Markwald with the California
11 Environmental Associates representing Briggs and Stratton
12 to discuss this issue along the lines we had today,
13 discussing the desire of the industry to look at a
14 counterproposal and also to look at some of the -- address
15 the travel issues.
16 And on September the 8th I had a meeting with
17 Kirk Markwald and Bob Wyman, Attorney at Law with Latham &
18 Watkins, representing Briggs and Stratton. And that was
19 also to address the issue of a counterproposal to address
20 the issue of travel. And it was after the introduction of
21 the bond amendment.
22 So with that, let's throw it open for discussion.
23 BOARD MEMBER RIORDAN: Mr. Chairman, if I might.
24 It seems to me that we had staff accommodate many of the
25 issues that were in the plan. Obviously details need to
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1 be worked out. I certainly would support the 30-day
2 review period in recognition of those items that need to
3 be discussed in final detail; and then certainly allow you
4 the discretion if you think this Board should ever be
5 involved with any of the issues following that
6 approximately 60-day period.
7 CHAIRPERSON LLOYD: Okay. Other comments?
8 Ms. D'Adamo.
9 BOARD MEMBER D'ADAMO: Oh, I'm sorry. I took it
10 to mean it was a motion. I was just going to add to it.
11 No comments.
12 CHAIRPERSON LLOYD: Okay. Please do.
13 BOARD MEMBER D'ADAMO: If that could be offered
14 as a motion --
15 BOARD MEMBER RIORDAN: I'll put that in the form
16 of a motion.
17 BOARD MEMBER D'ADAMO: -- for the resolution
18 that's before us with that addition.
19 Then in addition, I'd like to make certain that
20 the zero emission component is reviewed by staff with
21 regard to a number of different options, incentive or a
22 fleet concept or other mechanisms, and that staff report
23 back to the Board. I don't recall if we --
24 CHAIRPERSON LLOYD: Six months.
25 BOARD MEMBER D'ADAMO: Six months?
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1 All right. Within six months.
2 With that, I'd second it.
3 CHAIRPERSON LLOYD: Sounds good.
4 So if there's no other discussion, again I --
5 Professor Friedman.
6 BOARD MEMBER HUGH FRIEDMAN: Just to make the
7 record clear. I don't think that -- we're acting on this
8 proposal and resolution, and then as a follow-on we're
9 asking the staff to look in to this other. I don't want
10 to -- this is not part of this action.
11 BOARD MEMBER D'ADAMO: No.
12 CHAIRPERSON LLOYD: No, no, no, no.
13 BOARD MEMBER HUGH FRIEDMAN: It's related
14 obviously.
15 CHAIRPERSON LLOYD: Yeah, that's right.
16 BOARD MEMBER HUGH FRIEDMAN: It's not dependent
17 on it and it's not part of it so that --
18 EXECUTIVE OFFICER WITHERSPOON: Thank you for
19 clarifying that.
20 CHAIRPERSON LLOYD: And, again, I think it's --
21 you know, as I said earlier, this puts us in a somewhat
22 uncomfortable position. But I feel we have to bring this
23 to conclusion and send a signal.
24 BOARD MEMBER HUGH FRIEDMAN: I just wanted to add
25 that I think we are scrambling desperately to find every
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1 pound, every ounce, every ton of emission reduction in
2 this state. We're seeing that we're losing ground in
3 South Coast and elsewhere. We have a federal mandate. We
4 have our own needs for the health of people. And we have
5 obviously a direct legitimate and important interest in
6 reducing emissions. And this is another area where we can
7 reduce them, and we've known that for a long time. And
8 we've tried to work out a reasonable, rational plan for
9 it.
10 The original proposal met with opposition from
11 those who would be regulated, and they responded. And
12 they proposed alternatives, which I understand we have
13 pretty much accepted as alternatives, which appear to me
14 to respond to and adequately address and take care of the
15 principal concerns that were raised in terms of safety on
16 the temperature issue, the exhaust reductions.
17 And at the same time we get a bigger -- as much a
18 bang or bigger bang through increasing the evaporative
19 emissions, which was part of the industry's proposal as I
20 understand it, including Briggs and Stratton and others.
21 So, again, I think this is a collaborative
22 effort. And there are details to be ironed out,
23 clarifications to be made that are sought by industry.
24 And that's the reason we have this 15- or now 30-day
25 process for notice. And I feel we're doing what we need
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1 to do. It's important that we do it for a lot of reasons.
2 And so I -- if it was seconded, I third it. If
3 not, I'm ready to vote.
4 CHAIRPERSON LLOYD: Thank you.
5 And Supervisor DeSaulnier.
6 BOARD MEMBER DeSAULNIER: Just briefly. I do
7 think it's important, although it's separate, to reiterate
8 going after the zero. There's lots of potential there.
9 And all kidding aside, I think staff can come up with
10 something.
11 I also wanted to, in terms of something -- in
12 regards to Jed's comments. I remember last time the
13 Board, and some of us who were here, dealt with this
14 source and it was very contentious. And I remember a
15 quote in the Wall Street Journal about that directed at
16 the manufacturers. And unfortunately those -- and some of
17 my colleagues remember -- unfortunately broke in to the
18 Japanese manufacturers and the American manufacturers.
19 And the quote in the Journal story was critical
20 of the American manufacturers -- and I can't remember who
21 said it, it wasn't me, I wish I had -- was that Japanese
22 companies had spent more time on research and development
23 and the American companies, unfortunately, spent too much
24 time on lawyers and lobbyists. And I think that's changed
25 dramatically this time. We obviously have one unfortunate
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1 situation. But I did want to acknowledge to Jed that I
2 think the industry has come a long way and hopefully we
3 can close those last remaining obstacles.
4 And then, lastly, I can't help but make a comment
5 about how many times I've heard the word "recall" in the
6 last couple hours. And it's nice to hear it in a
7 different context. Although I can't help but say it may
8 be harder to recall one lawnmower than it is to recall the
9 Governor of California.
10 Thank you, Mr. Chairman.
11 CHAIRPERSON LLOYD: Well, I think we need to fix
12 that. And so I will definitely --
13 BOARD MEMBER DeSAULNIER: Do we have the
14 authority?
15 CHAIRPERSON LLOYD: No, I would definitely like
16 on the lawnmower side -- I think included in our
17 resolution I would like to follow up my earlier comments
18 about looking at an effective program to monitor end-use
19 emissions. And that's enough said. So we may have
20 opportunities there.
21 So with that I think -- no more comments. I'd
22 ask for a vote. We've got the resolution seconder.
23 All in favor say aye.
24 (Ayes.)
25 CHAIRPERSON LLOYD: Anyone against?
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1 No.
2 Thank you.
3 And, again, thank you very much, staff, for a
4 great job as usual there. And I really appreciate it very
5 much.
6 And thank you for coming -- for the industry
7 coming to testify. Hopefully we can get to a better spot.
8 But I think we've come a long way to answer that.
9 And, Jed, we can assure you you will have -- we
10 can keep you busy between now and Christmas.
11 BOARD MEMBER RIORDAN: All right, Jed. We've got
12 a -- you know, so 60 days from today, figure that all out.
13 You'll be here at the right time.
14 CHAIRPERSON LLOYD: We'll take just a five-minute
15 break. And then we'll go in to the last item for the day.
16 (Thereupon a recess was taken.)
17 CHAIRPERSON LLOYD: Final item on today's agenda
18 is 03-7-4, informational report on supplementary
19 activities related to the zero emission vehicle Program.
20 When we adopted modifications to the ZEV program
21 in April of this year, we made difficult decisions about
22 the direction and structure of the regulation. By the end
23 of the hearing I believe this Board crafted a delicate
24 balance that takes advantage of the strides made by
25 extremely clean gasoline vehicles and the full potential
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1 of the rapidly growing hybrid vehicle market.
2 Most importantly, the revised regulation allows
3 for the continued development of zero emission vehicles on
4 a technically sound pace.
5 Our goals throughout the years remained the same:
6 Improved emissions from motor vehicles with a long-term
7 vision of commercializing zero emission vehicles.
8 We've learned in the course of the ZEV Program
9 that commercialization of pure ZEVs continues to be
10 challenging and many ideas and possibilities continue to
11 develop. As a consequence, the Board directed staff to
12 evaluate whether it was appropriate and beneficial to the
13 overall ZEV Program to provide incentives for stationary
14 fuel cells and hydrogen infrastructure, as well as
15 increasing incentives for transportation systems. I look
16 forward to the results of that assessment.
17 Ms. Witherspoon, I turn it over to you.
18 EXECUTIVE OFFICER WITHERSPOON: Thank you,
19 Chairman Lloyd and members of the Board.
20 At the March and April Board meetings, there were
21 some intriguing ideas for ZEV credits on the table. We
22 did not have a full chance to evaluate given the pressures
23 of time and the complexity of the larger issues the Board
24 was debating at those hearings.
25 Consequently, you asked us to come back with a
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1 more detailed evaluation and specific recommendations on
2 three things:
3 Should stationary applications of motor vehicle
4 fuel cells receive ZEV credits? If yes, how should those
5 credits be structured?
6 Should ZEV credits be used to foster the
7 development of hydrogen infrastructure?
8 And should transportation system credits be
9 enhanced or expanded?
10 The informational report before you is staff's
11 attempt to describe what's at stake, to identify the pros
12 and cons; and when we've reached the conclusions, to give
13 you our advice about which, if any, credits should be
14 added to the ZEV Regulation you approved in April.
15 If you like anything that you see here and wanted
16 to pursue it further, staff will turn those ideas in to
17 actual regulatory language and run it through our normal
18 workshop and hearing process. That would bring us back
19 before the Board with a narrow proposal sometime next
20 spring.
21 Alternatively, if you conclude that no additional
22 ZEV credits are needed or warranted at this time, we'll
23 leave the existing credits in place until the next time
24 the Board revisits the overall ZEV Regulation, most likely
25 in the 2006 to 2007 timeframe.
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1 Mr. Gerhard Achtelik of the Mobile Source Control
2 Division will now make the staff presentation.
3 (Thereupon an overhead presentation was
4 Presented as follows.)
5 MR. ACHTELIK: Good evening, Chairman Lloyd and
6 members of the Board. I will begin the staff presentation
7 with a brief background on why we are coming to you with
8 this informational report, and some activities related to
9 the zero emission vehicle Program. I will also summarize
10 staff's findings and recommendations.
11 --o0o--
12 MR. ACHTELIK: At the April 2003 public hearing
13 the Board considered and adopted amendments to the zero
14 emission vehicle regulations. At that time, the Board
15 directed staff to evaluate whether it was appropriate and
16 beneficial to the ZEV Program to provide incentives for
17 stationary fuel cells and hydrogen infrastructure, as well
18 as increase incentives for transportation systems.
19 The staff conducted their evaluation, and for
20 each topic identified the relevant parameters: That if
21 incentives would be beneficial to the zero emission
22 vehicle development and if zero emission vehicle credits
23 would be an appropriate incentive.
24 I will present the topics in the order listed.
25 --o0o--
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1 MR. ACHTELIK: For the first topic, staff
2 investigated if the use of vehicle fuel cells in
3 stationary applications could foster zero emission vehicle
4 development.
5 At this time, fuel cells are at an early stage of
6 commercial development. Only a limited number of
7 commercial products are available. Providing incentives
8 for the placement of stationary fuel cells could increase
9 production of fuel cells above the number anticipated
10 through the ZEV regulations.
11 The table on this slide identifies parameters
12 that could be affected through increased fuel cell
13 production.
14 The increased production of fuel cells have the
15 potential to positively influence manufacturing experience
16 and the component supplier base. This could provide
17 modest cost reductions.
18 In addition, the use of stationary fuel cells
19 could also provide accelerated service life information.
20 Within seven months of full-time operations a stationary
21 fuel cell could achieve the rough equivalent of 100,000
22 miles. However, a stationary application is very
23 different from a motor vehicle application and would not
24 address all issues facing fuel cell vehicles.
25 Staff research leads to the conclusion there
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1 would be neutral impacts on the automation of fuel cell
2 assembly, vehicle integration, service condition
3 information, infrastructure, and codes and standards
4 development.
5 There are three areas of concern where the use of
6 ZEV credit incentives could create a negative or
7 unintended impact.
8 First, the fuel cell industry is still emerging
9 without a clearly established market. And staff
10 considered whether providing ZEV credits could create
11 disadvantages. It is important to note that there is only
12 one fuel cell type, the proton exchange membrane, or PEM
13 fuel cell, that is used in both the stationary and
14 vehicular markets. There are other types of fuel cells
15 that have advantages in specific applications, but are not
16 used in vehicles.
17 Through our research staff was unable to reach a
18 definitive conclusion on ZEV credits to vehicle PEM
19 manufacturers would disadvantage the competing fuel cell
20 manufacturers.
21 Second, when providing ZEV credits for any new
22 type of activity such as stationary fuel cells, the
23 tradeoff is fewer ZEV vehicles on the road.
24 And, third, although we think there is some
25 technical merit to providing ZEV credits for stationary
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1 fuel cells, we are concerned about the precedent that
2 would be set by providing mobile source credits for a
3 stationary application. To date, the California vehicle
4 regulations require direct compliance and have not allowed
5 stationary credit of any kind. This approach has been
6 successful. We specifically seek policy direction from
7 the Board on this issue.
8 --o0o--
9 MR. ACHTELIK: Given these findings, staff is
10 hesitant to recommend ZEV credit for stationary fuel
11 cells. If the Board chooses to award credits, staff
12 recommends the credits be limited as follows:
13 Provide silver credits. The use of vehicle fuel
14 cells in a stationary application is zero emission vehicle
15 engagement. It does not produce a vehicle, but
16 potentially fosters the development of technology that is
17 used in a vehicle.
18 Credits should be limited to fuel cell technology
19 with demonstrated use in motor vehicles.
20 Credits should be limited to California
21 placement.
22 Credits need to be capped so they do not
23 overwhelm the ZEV Program.
24 Credits should sunset after 2008, which is the
25 end of the initial phase of the alternative compliance
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1 path.
2 And any credit continuation should be reviewed by
3 an independent expert review panel.
4 --o0o--
5 MR. ACHTELIK: For the second topic, staff
6 investigated the role of incentives for developing
7 hydrogen infrastructure. Staff recognizes that the
8 availability of hydrogen refueling stations will be
9 critical to the success of fuel cell vehicles. However,
10 the fundamental question for this review is: What is the
11 role of government in specifically the ZEV Regulation in
12 developing hydrogen infrastructure?
13 Since ZEV credit is needed by automakers, not
14 energy suppliers, providing ZEV credits for fueling
15 infrastructure could send a confusing signal about who the
16 State is expecting to step forward. Staff finds that
17 energy providers are the best fit for infrastructure
18 development. Therefore, staff recommends that ZEV credits
19 not be used to develop fueling infrastructure.
20 A strong factor in staff's recommendation is the
21 existence of the Clean Fuels Outlet Program. The Clean
22 Fuels Outlet Program requires owners or lessors of a large
23 number of retail stations to provide a certain number of
24 clean fuel outlets on approximately 20,000 vehicles using
25 the same fuel that are in use statewide.
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1 Although the program was not developed with
2 hydrogen in mind, it is sufficiently broad to apply to
3 hydrogen.
4 Additionally, the California Fuel Cell
5 Partnership has proven to be an effective way to achieving
6 the early milestones needed to create hydrogen
7 infrastructure. The fuel cell partnership has
8 successfully placed seven hydrogen fueling stations in
9 California. The partnership is also a guiding contributor
10 to the development of vehicle and infrastructure-related
11 codes and standards, and ARB remains committed to being an
12 active member in this partnership.
13 --o0o--
14 MR. ACHTELIK: Concerns over providing ZEV credit
15 for hydrogen infrastructure are the same as those
16 expressed for stationary fuel cells. They include the
17 impact on the ZEV production requirements and the
18 precedent that would be set by providing mobile source
19 credits for stationary applications.
20 While staff does not recommend providing the ZEV
21 credits for hydrogen stations, we did identify several
22 areas for some type of incentive which help achieve
23 specific important infrastructure development goals. As
24 the number of hydrogen fuel vehicles increases,
25 specifically incentives could be used to focus on hydrogen
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1 production through clean or removable means, development
2 of fuel infrastructure at targeted locations, and to
3 assure a sufficient quantity of stations.
4 For the third topic staff was asked to determine
5 if incentives for car sharing, station car projects, or
6 transit-related projects should be implemented. Such
7 projects are valuable to ARB's efforts to improve air
8 quality, not only through their emission reduction
9 benefits, but also through their support of
10 commercialization of ZEVs.
11 --o0o--
12 MR. ACHTELIK: Staff reviewed the existing
13 regulation and found that the current incentives are
14 appropriately generous to encourage these projects.
15 Therefore, staff recommends do not change the credit
16 value. However, staff did find that it would be
17 appropriate to allow Neighborhood Electric Vehicles, or
18 NEVs, to earn transportation system credits if their value
19 is limited. The current regulations specifically exclude
20 NEVs from earning such credit.
21 The use of NEVs in transportation projects
22 provides a relatively lower cost, clean vehicle option;
23 increases the number of miles traveled in clean vehicles;
24 and provides a vehicle appropriate for short trips.
25 An additional means to expand incentives to car
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1 sharing or station car projects is to allow transportation
2 system credits to be applied to the goal ZEV is requiring
3 for manufacturers on the alternative compliance path.
4 While this could encourage more ZEVs to be used in car
5 sharing or station car projects, it could decrease the
6 number of ZEVs produced. Therefore, staff recommends that
7 these credits be included in the BEV substitution cap in
8 the alternative compliance path.
9 In determining appropriate credit ratios staff
10 could consider comparable costs for compliance options.
11 Another means of encouraging the use of ZEVs is
12 to provide credit for taxi or shuttle services that have
13 links to the transit systems and use ZEVs. Taxis and
14 shuttles typically are used in highly populated areas with
15 poor air quality and travel a significant number of miles.
16 In addition to the air quality benefit, the use of ZEVs
17 for taxis and shuttles would provide additional public
18 exposure to ZEV technologies.
19 While the availability of additional credits for
20 transportation system related activities can provide
21 benefit to the development of ZEVs, the use of credits
22 will decrease the overall number of vehicles required to
23 be produced.
24 Finally, staff will continue to work through an
25 agreement with the California Energy Commission and the
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1 California Department of Transportation to foster
2 non-regulatory projects that facilitate car sharing and
3 station car projects.
4 --o0o--
5 MR. ACHTELIK: To conclude my presentation for
6 the three topic areas that the Board directed us to
7 review, I'll provide a brief summary of possible next
8 steps.
9 For the use of vehicle fuel cells in stationary
10 application, the staff was hesitant to recommend along the
11 ZEV credits because of the policy concerns described; and
12 recommend that if credits are allowed, that the credits be
13 limited.
14 For hydrogen infrastructure, staff recommends
15 against the use of ZEV credits.
16 And for transportation system, staff recommends
17 expanding the availability of credits to allowing the
18 restricted use of transportation credits in the
19 alternative compliance path.
20 If the Board decides additional ZEV credits are
21 appropriate, staff will begin a series of workshops and
22 meetings to develop a regulatory proposal. The regulatory
23 proposal would be brought to the Board for consideration
24 in spring of 2004.
25 In addition, staff will continue to work with
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1 partners such as the California Energy Commission,
2 California Department of Transportation, and the
3 California Fuel Cell Partnership.
4 This concludes my presentation. And thank you
5 for your time. We would be happy to answer further
6 questions.
7 CHAIRPERSON LLOYD: Thank you very much.
8 Professor Friedman.
9 BOARD MEMBER HUGH FRIEDMAN: A couple quick
10 questions.
11 On the stationary fuel cells, am I correct in
12 assuming that they would replace otherwise emitting --
13 pollution emitting motors? And unless they're on battery.
14 I mean wouldn't there be emission reductions as a positive
15 predictable from --
16 EXECUTIVE OFFICER WITHERSPOON: That depends
17 where the hydrogens come from, I suppose. Because you
18 would have to consider stationary fuel cells of hydrogen
19 against the electricity that otherwise would have been
20 provided to that stationary facility.
21 Also, whether it's used in a backup context or
22 for a fullpower load, that's --
23 BOARD MEMBER HUGH FRIEDMAN: So there are not
24 necessarily emission reductions using fuel cells --
25 stationary fuel cells as compared to not using them?
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1 EXECUTIVE OFFICER WITHERSPOON: Well, we'll need
2 the Chairman because he's as knowledgeable about this as
3 anyone. I mean I do think it's -- I do think it's a life
4 cycle analysis sort of a thing, and it does depend where
5 the hydrogen came from and how it was produced in this
6 state, from what fuel stock. It's going to come in a
7 bottle is the thing. And so I -- you can analyze it in
8 terms of a large deployment theoretically. But in the
9 practical application of, you know, a handful of
10 stationary fuel cells, I don't know if it's a meaningful
11 analysis.
12 CHAIRPERSON LLOYD: I think it can have a
13 significant emission benefit or it could be neutral.
14 BOARD MEMBER HUGH FRIEDMAN: I mean if it's a
15 diesel -- a dirty diesel, that's --
16 CHAIRPERSON LLOYD: And I think on a case-by-case
17 basis.
18 BOARD MEMBER HUGH FRIEDMAN: Okay. Well, I was
19 just wondering in an attempt here to relate positives and
20 negatives.
21 Also sunseting after 2008. There was something
22 elsewhere that said after 2009.
23 Is it 8? Is that the year that the staff was
24 suggesting? Assuming --
25 EXECUTIVE OFFICER WITHERSPOON: Yes, it will run
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1 through the first phase, the '05 through '08 deployment of
2 the fuel cell vehicles, the 250 fuel cell vehicles. And
3 then to be revisited later. And the question is: Is it
4 still vehicle enabling? Or are we now on to other
5 questions about the vehicles that cannot be addressed and
6 very helpful by the stationary fuel cells.
7 BOARD MEMBER HUGH FRIEDMAN: We have some I guess
8 people that --
9 CHAIRPERSON LLOYD: -- that will be testifying,
10 yes.
11 Supervisor DeSaulnier.
12 BOARD MEMBER DeSAULNIER: Just briefly, Mr.
13 Chairman.
14 BOARD MEMBER CALHOUN: I guess I don't
15 necessarily agree with the -- if you have -- a previous
16 comment relative to the use of a fuel cell. If you have a
17 fuel cell that -- if there aren't -- one stationary --
18 stationary source and another one in a fuel cell, you're
19 trying to -- assume that you're trying to really develop
20 this technology, maybe it isn't completely fully
21 developed.
22 Wouldn't there be an advantage to use -- if
23 you've used the same fuel cell, wouldn't there be an
24 advantage to get the information from the fuel cell that's
25 been used in the stationary source?
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1 EXECUTIVE OFFICER WITHERSPOON: Well, you're
2 comparing the stationary fuel cell to putting it in a
3 vehicle and how many hours it might be driven and how much
4 fuel it might consume. And that's one comparison. I
5 understood Professor Friedman's question to be about
6 additional benefits that might happen by displacing
7 electricity sources --
8 BOARD MEMBER CALHOUN: I'm just comparing two
9 fuel cells. I'm not displacing --
10 EXECUTIVE OFFICER WITHERSPOON: Right. And
11 whether the hydrogen would be the same or not, I don't
12 know. But, again, we're talking about so few units.
13 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: I think
14 the differentiation we see in terms of the technology
15 we're seeing is that the stationary fuel cell is largely
16 "the fuel cell," and in a vehicle it's a complete system,
17 which includes the drive and all that stuff.
18 BOARD MEMBER CALHOUN: I understand. But the
19 staff concludes they're identical, are they not?
20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,
21 they are. But the reason that we're saying that if you
22 were to do this -- which we're actually not
23 recommending -- but if you were to do this, that it fits
24 better in AT PZEV. Because AT PZEV's job, that we set it
25 up in the silver category, is to bring the components
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1 along so later on you can build a real ZEV, fuel cell or
2 battery or whatever. And because the stationary thing
3 only deals with one piece, it's sort of enabling, but it's
4 not a substitute. So that's why we say it would be better
5 to fit it in the AT PZEV category.
6 And whether it creates emission reduction or
7 benefits, it's kind of hard to figure out. Yes, if you
8 put a fuel cell in place of a diesel generator, clearly
9 it's cleaner, right? But if you give it credits, it
10 depends on what those credits are used for. If you give
11 it gold credits, then those credits mean we're going to
12 get fewer fuel cell cars. And that might -- won't have
13 much of a direct impact on emissions, but it might stop
14 the technological movement and the stepping stones to what
15 is commercialization. If you give it AT PZEV credits, it
16 means there will be fewer AT PZEVs produced, which means
17 there will be more non-AT PZEVs or non-higher emitting
18 vehicles produced because you're using credits instead.
19 And that will have a negative impact on emissions.
20 How those actually trade off is -- you know, I
21 don't know what we can calculate because it depends on how
22 the fuel cell's used.
23 BOARD MEMBER CALHOUN: I disagree with that. So
24 we'll move on to the next question.
25 Why would it be necessary for an expert review
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1 panel to review whether or not fuel cell stacked and used
2 in the stationary source be used in a vehicle? To me
3 that's strictly a policy issue. I don't see where the
4 expert panel comes in to this.
5 EXECUTIVE OFFICER WITHERSPOON: We were simply
6 saying that if the Board chose to give stationary credits,
7 which Tom points out the staff's not recommending, that if
8 you did it, you should have a sunset and not do it in
9 perpetuity, and that you should ask the question of
10 yourselves, of us -- and we could bring the outside review
11 panel in or not -- but ask the question: Is this enabling
12 to the vehicles? If we keep giving this credit past 2008,
13 are we helping anything or are we just giving cars away?
14 Because every time you grant credit you get fewer cars
15 because you're going to get stationary fuel cells instead.
16 CHAIRPERSON LLOYD: Well, I agree with Joe. I
17 don't think we need an expert panel on that. It's one of
18 the benefits of working through a partnership. We're all
19 working together and sharing in that experience. And
20 we're going to see as a partner whether that's still the
21 case.
22 EXECUTIVE OFFICER WITHERSPOON: We would still
23 suggest a sunset so it gets --
24 CHAIRPERSON LLOYD: Oh, that's a separate issue,
25 a separate issue.
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1 What I'd like to do is call the first witness
2 here, because we've been speculating. But now I'd like to
3 call up Tim Vail from GM, who's actually the experts on
4 this.
5 Tim, you really scared the Board when I heard
6 that you were on the wrong presentation. Can you cut it
7 down to five and hit the highlights?
8 MR. VAIL: Yeah, well, I brought 110 slides.
9 CHAIRPERSON LLOYD: Well, I figured that.
10 MR. VAIL: So, you know, I would not want to go
11 through all of them.
12 But, no. I can shorten it up.
13 CHAIRPERSON LLOYD: You increase your chances of
14 the Board directing staff, you know, if you --
15 MR. VAIL: Yeah, I understand the time.
16 Hopefully I'll be able to get through it in the time
17 period. And the first few slides are what's important.
18 And, you know, if we get through the rest, it's not -- you
19 know, we can move them along.
20 (Thereupon an overhead presentation was
21 Presented as follows.)
22 MR. VAIL: But I am -- I'm Tim Vail. I'm the
23 Director of our Fuel Cell Commercialization Activities at
24 GM. I'm based in Detroit. And my job is to try to figure
25 out a way so that we can get these fuel cells into the
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1 market before we actually have them available for cars.
2 DG is a big component of my work, and I think a
3 very, very important aspect of advancing fuel cell
4 technology.
5 --o0o--
6 MR. VAIL: Why we're here today is we really
7 believe that stationary fuel cells are key to the
8 development path for automotive fuel cell placement. But
9 we have a challenge in that today the DG market with PEM
10 fuel cells is not supportable from an economics basis.
11 And what we need is we need other things to help us kind
12 of over that hill in the business case. And if we could
13 get some form of credit in California for our stationary
14 full cells, this would certainly make a compelling case
15 for us.
16 And so what we're asking today is that the Board
17 reaffirm its support for limited AT PZEV credits for DG
18 applications.
19 --o0o--
20 MR. VAIL: And we actually have many areas of
21 agreement with the staff report.
22 We agree that AT PZEV credits are appropriate.
23 This does advance a component of a ZEV vehicle. It's an
24 important component, the fuel cell stack itself, but it
25 doesn't advance the entire system. So we think that the
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1 PZEV credits are appropriate.
2 We agree that there should be a limited term on
3 the -- excuse me. We agree that the full cell credit
4 should only go to vehicles. We also agree that there
5 should be a cap on the number of credits.
6 We agree that there should be a sunset provision,
7 and the 2008 sunset provision is acceptable.
8 And we agree that the fuel -- the credits should
9 be limited to just the LEVs. And what we really see this
10 as is not a replacement of ZEV vehicles, but we really see
11 this as a short-term measure in order for us to jump start
12 our long-term vision of commercial retail fuel cell
13 vehicles.
14 --o0o--
15 MR. VAIL: Well, I just want to recap here. What
16 we're talking about is the technology is exactly the same
17 in the DG unit that we'd be putting in the vehicles. We
18 are very focused on producing what we call the fuel cell
19 power module. And that power module is what's key. We
20 know how to build cars. What we need to learn how to
21 build and what we need to build a supplier base around is
22 that module. And so the more modules we can produce, the
23 more it advances our program. What we'd like to do is put
24 a larger quantity in to stationary applications and limit
25 the number that go into cars. And there's a lot of
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1 reasons around that, but primarily it's cost and
2 supportability of the vehicles.
3 --o0o--
4 MR. VAIL: And so today there really is no fuel
5 cell industry. I mean there's a lot of fuel cell
6 development activities. But one of the challenges we have
7 as the automotive maker is -- the supply place development
8 is incredibly important for us to be successful with the
9 vehicles. And today all they see is these runoffs that
10 are a limited number of demonstration applications.
11 And what we -- in discussions with them, what we
12 really find is that a real true commercial opportunity is
13 what really turns them on and gets them excited. And it
14 really is a -- it's really two reasons why: 1) When you
15 put them into a DG application, you really lower the --
16 not only the support cost, but also the legacy risk of
17 those units, in the sense that if we got a technology
18 problem and we have something wrong with one of our
19 stacks, we can just go down there and replace it with
20 another one in the power unit. But if it's in a vehicle,
21 we have to actually strap the vehicle. You can't just do
22 an easy replacement.
23 Also when we have a -- had them in a DG
24 environment, we're much better at controlling the
25 environment. So when we really look for real-world
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1 testing, we can do many more tests and many more cycles in
2 a stationary environment than we can in a car.
3 And I want to address a common misconception
4 about the stationary duty cycle and the automotive duty
5 cycle. They're very different. But what we intend to do
6 is operate our fuel cells in the majority of the time on
7 what we call the Rosso automotive duty cycle.
8 So, for example, in Dow Chemical one of the deals
9 we announced this summer, we're actually going to put
10 those fuel cells down there and run them like they're in a
11 car. We're going to cycle them up and down, start them
12 and stop them. And then when we have enough of them in
13 one location, we can balance -- and still produce power,
14 yet balance the needs of that testing.
15 So what's really important to us in our supplier
16 base is that we can start to build volume in these
17 modules, and we can do it now as opposed to waiting till
18 later. And what this really means is that we can bring
19 cars -- real volumes of cars to market much sooner when we
20 have this avenue.
21 --o0o--
22 MR. VAIL: And a graphical depiction of that
23 is -- we have -- today we're in this kind of demo phase.
24 And demos are going to get us to a limited number. We're
25 also going to build some engineering vehicles, and that
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1 will certainly help. But the industrial power in
2 distributed generation is where we really capture most of
3 our early-term volume. And it's -- you know, frankly I
4 don't know how we're going to be able to get over that
5 hump without some distributed generation market
6 penetration, because we just can't build enough cars that
7 make a difference in this interim period to be able to
8 engage the supplier base and get us there. And DG and
9 industrial power is clearly the way for us to do that.
10 But we can't make the business case for it today
11 without some sort of alternative value driver. And that's
12 why the credits are so important to us. And I think if we
13 were able to get AT PZEV credits -- granted, for just a
14 short time, we don't need it forever, we just need it for
15 this kind of introductory period -- that's going to give
16 our board at GM the real impetus to "Hey, let's start
17 building this DG market."
18 And we agree that we don't need to -- we're not
19 looking for the credits to replace those in states that
20 aren't part of the -- you know, the -- I guess the
21 traveling, you know, piece of it. And so we're looking to
22 put DG units in California in a quantity that will help us
23 get through the stair step.
24 Now, Alan, I have, you know, six more slides that
25 kind of go through the points one by one. You have our
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1 written comments as well as this deck. And feel free to
2 look at it. But, yeah, I think that's, you know, the real
3 core of our position is that we need this early volume.
4 CHAIRPERSON LLOYD: I think you've hit the high
5 points as far as I'm concerned.
6 MR. VAIL: Any questions?
7 CHAIRPERSON LLOYD: Thank you.
8 MR. VAIL: Thank you.
9 CHAIRPERSON LLOYD: You can see the Board is
10 pretty stressed out here, I guess. But we made the key
11 points, which --
12 BOARD MEMBER RIORDAN: Mr. Chairman, he made a
13 very good presentation. He covered it all. Look at it
14 that way, positive.
15 CHAIRPERSON LLOYD: Now, Tom, if you could do
16 likewise.
17 MR. FULKS: Mr. Chairman, Board members. My name
18 is Tom Fulks. I am the Executive Vice President of the
19 Green Car Marketing communications and a researcher for
20 the Green Car Institute.
21 (Thereupon an overhead presentation was
22 Presented as follows.)
23 MR. FULKS: We're working with DaimlerChrysler on
24 the NEV as a class of vehicle. And it's always my
25 pleasure to speak to your Board when I'm extremely rushed
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1 for time, which seems to be the case every time I stand up
2 here. So I'm used to it. I'm prepared. So if you don't
3 mind, I'm just going to blast through.
4 --o0o--
5 MR. FULKS: I'm here to talk about two things in
6 particular:
7 One is the station car concept, the systems
8 concept. Just to give you a brief update, we and Daimler
9 are in support of the staff recommendation to allow
10 credits for NEVs for station car programs and systems
11 programs obviously.
12 A quick update. We're doing a program now, a
13 demonstration program, data collection program with
14 Sacramento Regional Transit. Originally, the concept was
15 to place 20 NEVs in Natomas -- in the Natomas area because
16 it's a master planned community, which in our research is
17 the most promising area for the increased use of NEVs as a
18 class of vehicle.
19 Regional Transit's kind of pushing back, saying,
20 "Well, you know, we have actually some applications for
21 the NEV as a station car that may be better, in fact it
22 may bring you better data when you're tracking the use of
23 these vehicles." And the data we're collecting from these
24 users will be: Does it increase transit ridership? Does
25 it -- do we have higher occupancy in the NEV cars
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1 themselves? And do we do a number of other things? Does
2 it encourage transit ridership as an incentive in any way?
3 We'll be tracking that information and bringing it back to
4 you at some point probably in the spring.
5 We expect a launch program by the end of this
6 year. We're in the implementation discussion phase right
7 now with Regional Transit. So that's where we are on that
8 one.
9 And the next issue I'd like to talk to you about
10 is the ZEV credit issue itself with NEVs. And if
11 you'll -- as you'll see, the staff report up here
12 basically said, "We'll come back and visit this when we
13 have more data." And so we actually have more data. And
14 that's what I wanted to talk to you about on my next
15 slide.
16 And obviously I'm not working this thing
17 correctly.
18 Thank you.
19 Is this working or are you doing it manually?
20 --o0o--
21 MR. FULKS: Okay. We went in in July of this
22 year in -- oh, I'm going backwards. Excuse me. Sorry.
23 User error.
24 We went in in July of this year and did a study
25 of NEV users in California. We used the GEM database of
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1 10,000 NEV users. We know for our own research in the
2 industry that there about 15,000 NEVs in California. I
3 think I testified to this effect several months ago.
4 While at that time staff -- and we have been talking to
5 staff about this -- basically said, "Well, let's go find
6 out more about this." And so that's what we did.
7 --o0o--
8 MR. FULKS: So we used the GEM database because
9 it's really the only database of NEV users available in
10 California. The volume of NEV sales is smaller for
11 everybody else, so it was a reliable database. Although
12 we do know that as a result of forward thinking favors,
13 the club car and pathway, and of course they were given
14 away by another company, plus any others, there are about
15 15,000 in service right now. Which of course it does
16 represent the largest single concentration of pure Battery
17 Electric Vehicles anywhere in the world. And that's sort
18 of an assertion that we're making based on the data.
19 --o0o--
20 MR. FULKS: If I could just get this doggone
21 thing to work for me, I'd be a lot happier.
22 So we interviewed 260 NEV users. One hundred
23 sixty of them were individual household users, buyers of
24 the vehicle; 98 were small fleet operators of four NEVs or
25 less. We interviewed them on the phone for 15 to 25
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1 minutes. Margin of error was 6.8 percent. The numbers
2 were crunched by the Institute for Transportation Studies
3 over at UC Davis, Ken Coronni, who's a good statistician.
4 And we used that data to extrapolate out to the 10,000
5 user database -- 10,000 user number, meaning all the
6 numbers that we're representing are based on a 10,000 NEV
7 user baseline as opposed to 15,000. So we wanted to be
8 conservative.
9 --o0o--
10 MR. FULKS: We found, interestingly, of all the
11 trips that NEV users took, they use their NEVs two out of
12 three times. When they were given a choice between an
13 internal combustion engine and a NEV, they chose the NEV
14 two out of three times. And so this is the type of mode
15 that they replaced when they did this. And so I'm trying
16 to make it quick.
17 But it's a really important point, that they
18 chose the NEV two out of three times. It's the only
19 technology we're aware of that actually not only provides
20 automobile drivers a choice, but makes them think about
21 how they travel about their communities.
22 Some quick statistics here. The average number
23 of trips a day in a NEV is 3 point -- whatever it is --
24 3.3. Small fleets were 14.5. The average number of trips
25 for a NEV as it is every day is 7.5.
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1 Next slide, please. I'm just going to give up
2 with this thing.
3 --o0o--
4 MR. FULKS: Most NEVs' trips are short.
5 Seventy-five percent of NEV trips are three miles or less.
6 So it's not the NEV making the trip, by the way. It's the
7 human being making the trip. So the behavior of an
8 automobile user is such that most of the trips are less
9 than three miles.
10 Within that category, we found out that half of
11 those small trips are actually less than one mile. So
12 that was a pretty interesting statistic.
13 So the point being, most people travel most of
14 the time on very short distance trips. It's their own
15 personal behavior. It's not the behavior of the car.
16 It's the behavior of the human being.
17 Next slide.
18 --o0o--
19 MR. FULKS: And I'm just going to blow right
20 through this one.
21 Basically most of these trips were trips of
22 necessity, as we call them. They were going somewhere to
23 do something very specific. They weren't joyriding
24 around. One out of five trips was for fun.
25 --o0o--
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1 MR. FULKS: But what really -- what we found
2 quite astonishing was how these trips added up. And you
3 can see the statistics. They'll speak for themselves.
4 But what we found is the NEV users would account for --
5 they do account for basically 8 million cold starts
6 eliminated every day. And we've got an area within our
7 study that discusses the methodology of measuring cold
8 starts. And I won't get in to it right now.
9 But to us, it was a very interesting statistic.
10 Although we know -- oh, great. Everybody in L.A. doesn't
11 start their car one time. You know, that's not that
12 significant overall. But it's a start. And it's
13 interesting.
14 Next slide, please.
15 --o0o--
16 MR. FULKS: Now, this is one of the things that
17 we found really interesting. It's the land use categories
18 of where people live when they own a NEV. It defied the
19 common perception that this is just a golf community
20 vehicle. It's not. If you could take a look -- the
21 biggest category was "other," because we weren't right
22 enough to understand exactly where people live in their
23 own words.
24 The "other" category includes apartment complexes
25 and condominium complexes and places like that. The
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1 largest identifiable area was a gated golf community of 16
2 percent. But then when you get down into the small town,
3 big town, urban center, rural, it's fairly evenly
4 distributed, meaning NEVs are used all over the place.
5 Next slide, please.
6 --o0o--
7 MR. FULKS: In summary, the California NEV
8 user -- I'm not going to bother with that one. But the
9 biggest statistic that jumped out at us was that
10 two-thirds of the NEV trips are replacing an internal
11 combustion engine; and of the NEV trips that are taken, 75
12 percent are more than two people -- are more than one
13 driver. Seventy-five percent of high-occupancy rates. It
14 reverses the occupancy rates of the traditional automobile
15 in California of 70 percent drive alone.
16 Next slide.
17 --o0o--
18 MR. FULKS: Now, what we did to quantify what the
19 benefit is --
20 CHAIRPERSON LLOYD: How many slides have you got
21 here?
22 MR. FULKS: I've just got two more. I'm just
23 really hustling to get you guys out of here to go to
24 dinner.
25 What we did -- we went back and asked our
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1 household users, "What kind of car are you leaving in the
2 driveway or the garage?" And what we found was it was
3 almost identical to the overall sales split of vehicle
4 types in California and the United States, which is 45.6
5 percent drive sedans and 54.3 percent drive SUVs, light
6 trucks, and vans. This is not published material. It's
7 not part of our study that we have on the website and
8 we've distributed to your staff and I believe to many of
9 the Board members.
10 But when we asked them, "All right. When you use
11 your NEV to replace these vehicles that you own, which one
12 do you replace?" they replace cars 43.6 percent and they
13 replace SUVs, trucks, and vans 47.6 percent.
14 Then we asked the SUV and van drivers, "Okay.
15 What specifically are you leaving in the driveway?" SUVs
16 were 50 percent -- 51 percent; light trucks, 27.1;
17 minivans; and then full-size vans. I thought that was an
18 interesting statistic.
19 Next slide, please.
20 --o0o--
21 MR. FULKS: The future -- what this all means for
22 the future is that there are -- we have another study that
23 identifies about 31 master-planned communities that are
24 being built in California during the next 10 years with a
25 minimum number of homes of 1,000. So all together just
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1 based on what's on the books for either in the entitlement
2 process or already approved, in the next 10 years
3 master-planned communities will account for 167,896 new
4 single-family homes in California. That's where the NEV
5 industry's probably going to be targeted over the next
6 couple of years in terms of volume of sales.
7 Next slide, please.
8 --o0o--
9 MR. FULKS: So based on that, we do recommend
10 that you adopt staff recommendations on the transportation
11 systems.
12 And I'd also like to recommend that you direct
13 staff to open up a dialogue about the worth of a NEV in
14 this larger mix of California mobility, because we believe
15 the data proves the worthiness of the NEV as a class of
16 vehicle. It is deserving of a chance to at least make its
17 case in this overall discussion of NEV credit. And that's
18 pretty much what we're asking. We don't want to get in to
19 the numbers right now. Just give the NEV owners a chance
20 to make their case. And so that's what we would be
21 requesting today.
22 Thank you.
23 CHAIRPERSON LLOYD: Thank you.
24 Comments from staff?
25 EXECUTIVE OFFICER WITHERSPOON: We did have an
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1 opportunity to hear a two-hour version of this
2 presentation or -- a two-hour meeting talking about it, I
3 think it was. And so it's intriguing data. But we did
4 not think in the context of what you asked us to report
5 back on we should be bringing up the fundamental issues of
6 NEV credits. And we did point out to the Green Car
7 Institute that NEV credits are very controversial with the
8 environmental community. And this is a request to change
9 the base credit, not just how they work in transportation
10 systems, which is what staff's proposal spoke to.
11 That being said, you know, I think we can
12 continue -- if we're going to be coming back on NEVs at
13 all, keep talking about the NEV issue and what role they
14 play and how much they're worth and showed the credit had
15 no jump at all from .15, which it is now. It used to be
16 .6. And we discussed in our meeting were there
17 intermediate values that anyone could accept, be that us,
18 you, the environmental community, or anybody else who
19 cared to express an opinion on the issue. But we most
20 wanted to report back to you about transportation systems,
21 which we did today, and did not entertain yet whether we
22 should change the base credit for NEVs themselves.
23 BOARD MEMBER CALHOUN: Did we not have the
24 proposed credit for NEVs in the meeting we had a couple
25 months ago -- two or three months ago? Wasn't ZEV -- NEV
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1 included in that?
2 EXECUTIVE OFFICER WITHERSPOON: Yes. Part of the
3 regulation you adopted reaffirmed the declining value of
4 NEVs, which dropped from .6 to .15 as we phase in, you
5 know, to these cleaner vehicles. And before that hearing,
6 after that hearing, here today proponents are coming
7 forward -- DaimlerChrysler's come to see us about this
8 too -- and said, "We really want that to change. We
9 really want higher base credits for NEVs."
10 And we've said, "Well, the Board decided it's
11 .15." That isn't on the table at the moment. But we're
12 listening and learning about how the NEVs are being used
13 today. And I'm not saying we won't ever consider it or
14 ever make a recommendation, but it wasn't part of what we
15 brought in in this staff report.
16 CHAIRPERSON LLOYD: Move on to Robert Kittell and
17 then Kathryn Phillips.
18 BOARD MEMBER CALHOUN: Let me mention one thing.
19 You may want to take another look at it. And you
20 may come out to the same spot -- the same place where you
21 did before.
22 CHAIRPERSON LLOYD: I think that's going to be
23 part of it.
24 Robert Kittell and Kathryn Phillips.
25 MR. KITTELL: Mr. Chairman, I have a two-minute
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1 prepared comment.
2 CHAIRPERSON LLOYD: Great.
3 MR. KITTELL: Dr. Lloyd, members of the Board,
4 my name is Robert Kittell and I'm Chairman of Electricab
5 Energy, owner and operator of the Electricab Taxi Company
6 here in Sacramento.
7 Our company supports the recommendations in the
8 staff report on supplemental ZEV credits.
9 CHAIRPERSON LLOYD: You know, I really didn't
10 know you operated a fleet of electric cars here as taxis.
11 MR. KITTELL: Yes. And I'll expand with a
12 little bit of detail.
13 CHAIRPERSON LLOYD: I never knew that.
14 How many staff knew that?
15 ON-ROADS CONTROLS BRANCH CHIEF KITOWSKI: Our
16 staff have been coordinating with him.
17 CHAIRPERSON LLOYD: So you knew all about it?
18 BOARD MEMBER DeSAULNIER: How many staff people
19 have used the service?
20 CHAIRPERSON LLOYD: Well, that's -- no, we should
21 be supporting that. And, as I said, I didn't know.
22 MR. KITTELL: Our company supports the
23 recommendations in the staff report on supplemental ZEV
24 credits:
25 "No" on ZEV credits for stationary fuel cells.
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1 "No" on ZEV credits for hydrogen infrastructure.
2 A qualified "yes" to expanding ZEV credits for
3 transportation systems.
4 And "yes" to transportation system credits in the
5 alternative compliance pack.
6 Our company fully supports extending the
7 transportation system ZEV credits to zero emission taxicab
8 and shuttle services that exhibit links to transit such as
9 airports and rail stations.
10 The Electricab Taxi Company has already
11 demonstrated such service here in Sacramento, including
12 real-world paid fares to Amtrak via our neighborhood
13 electric taxi.
14 Furthermore, our full-size, five-passenger,
15 freeway-capable electric minivan conversion taxicab has
16 demonstrated similar service to Sacramento International
17 Airport during our field testing. This vehicle, which is
18 parked out in front of the entrance to this building
19 today, has been calibrated and certified by Sacramento
20 County and only awaits a final inspection by the City of
21 Sacramento before officially going in to service.
22 Electricab would like the Board to go one step
23 further and recognize additional ZEV credits for such taxi
24 service that demonstrates integration of advanced
25 technologies in the operation of their vehicles.
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1 Electricab has been awarded a patent for
2 aggregate range optimation -- I'm sorry -- for aggregate
3 range optimization for battery electric and fuel cell
4 vehicles, which would be prominently demonstrated in the
5 Electricab fleet.
6 Such realtime wireless advanced out-driven
7 technology can only serve to maximize the impact of zero
8 emission vehicles and improve their commercial viability.
9 As such, incentives to support this type of innovation are
10 warranted.
11 Our company believes that extending car-sharing
12 and station-car-transportation-system ZEV credits to
13 factory NEVs is unwarranted. Unlike our company's fleet
14 of NEVs with advanced nickel-zinc battery pack upgrades
15 and 50-mile-per-charge and 300-mile-per-day capability,
16 factory NEVs offer limited range in battery life. These
17 factors combine to result in diminished real-world impact.
18 Unfortunately it is also clear that manufacturers
19 have gained ARB in the past with NEVs. And, in principle,
20 such additional opportunities should not be made available
21 to them again.
22 I thank you for your time and consideration, and
23 truly appreciate the opportunity to speak before the
24 Board.
25 CHAIRPERSON LLOYD: Well, thank you very much for
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1 coming.
2 And maybe we can encourage staff here. I can see
3 how difficult a job you've got to advertise when in fact
4 our staff is reluctant to tell the Board of what was out
5 there.
6 (Laughter.)
7 CHAIRPERSON LLOYD: But thank you very much
8 indeed.
9 Unfortunately you're out there, but we've not had
10 a chance to get behind this -- from behind this dais
11 today. So please come back another time so we can
12 actually come out. And maybe staff would set something up
13 and we can take a look.
14 MS. PHILLIPS: I'm Kathryn Phillips with the
15 Center for Energy Efficiency and Renewable Technologies.
16 And today I'm representing a number of my colleagues with
17 the American Lung Association of California and the
18 California Electric Transportation Coalition, the
19 Coalition for Clean Air, Environment Now, Natural
20 Resources Defense Council, Sierra Club, Steven and Michele
21 Kirsch Foundation, Union of Concerned Scientists.
22 We appreciate the Air Resources Board staff's
23 efforts to analyze the pros and cons of affording zero
24 emission vehicle credits for stationary fuel cells in the
25 infrastructure and in the mass transit system.
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1 We agree with staff on the stationary fuel cell
2 issue that awarding stationary fuel cell ZEV credits
3 raises several areas of concern. And some of the groups
4 signing or that I'm representing have sent comments in the
5 past and raised these concerns in previous letters and
6 comments.
7 Staff's conclusions about whether to give ZEV
8 credits to stationary fuel cells might be best described
9 as suggesting a soft "no." And we think a really strong
10 "no" is warranted. We urge the Board to reject the idea
11 of providing ZEV program credits to stationary fuel cells.
12 And I'll just give you a few reasons why.
13 A few months ago when the ZEV mandate reiteration
14 was being -- was going through its process, the Sierra
15 Club commented in a letter that this proposal is
16 essentially to promote -- is promoted by General Motors.
17 And we've had discussions with General Motors about the
18 company's ideas. We worry that this push for ZEV credits
19 for stationary fuel cells will essentially result in one
20 more loophole for an automaker to avoid complying with the
21 spirit and intent of the ZEV Program.
22 Additionally --
23 CHAIRPERSON LLOYD: We've been assured though
24 that GM is now reforming -- being reformed. And so --
25 MS. PHILLIPS: Well, you know, it almost pains
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1 me to have to say this because -- we've had multiple
2 conversations with Mr. Vail. And he's very genuine and we
3 wish him well in his division. But we have a harder time
4 with the company that's overseeing the whole process.
5 CARB established the ZEV Program in 1990 with the
6 specific goals of advancing vehicle technology and putting
7 zero emission vehicles on California's roads. And we're
8 concerned that the link between the stationary fuel cell
9 production and getting real fuel cell vehicles on the road
10 is not strong.
11 Additionally, historically the mobile sources and
12 the stationary sources have been regulated by separate
13 divisions within CARB, and in many cases separate agencies
14 within the State. And credits have not been traded
15 between mobile and stationary categories in general. We
16 don't see any compelling reason to change the arrangement
17 now with this particular program. And, indeed, as the
18 staff's report suggests, offering the stationary fuel cell
19 credits opens the threat of general deterioration of the
20 integrity of CARB's vehicle regulations.
21 Finally, the stationary fuel cell industry is in
22 its infancy. It offers a range of environmental benefits
23 that deserve incentives. And there are other programs
24 that exist in California to provide these incentives. And
25 in fact CARB has -- in its stationary program has produced
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1 some regulations and worked in other ways to try to help
2 increase those incentives.
3 On the hydrogen infrastructure issue, the staff
4 report rejects the idea of providing ZEV credits, and we
5 support that.
6 The organizations that have signed this letter,
7 these comments, we participated for a number of years to
8 try to encourage hydrogen fuel cell vehicles, and we do
9 understand that there is going to be a need for
10 infrastructure. But we think the time isn't right. And
11 certainly for the Board to adopt the ZEV credit system for
12 any refueling infrastructure, there are relatively few
13 hydrogen fuel cells on the road now or anticipated in the
14 next few years.
15 And providing credits for infrastructure at this
16 point would likely reduce those numbers further. And I
17 understand that right now there isn't any automaker coming
18 forth saying that they want to be able to provide
19 infrastructure with a certainty, which is another
20 indication that maybe it's premature to be developing
21 credits --
22 CHAIRPERSON LLOYD: It's not quite true.
23 MS. PHILLIPS: It's getting more certain?
24 CHAIRPERSON LLOYD: Well, we have heard
25 something.
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1 MS. PHILLIPS: Okay. We're concerned though
2 that mixing ZEV credits with stationary source activities
3 will offer opportunities for ZEV credit gain in this
4 category. So if you do do something, you're going to have
5 to very clearly define what qualifies as infrastructure.
6 In my wildest imagination I can see refineries -- rather,
7 chemical companies that produce hydrogen as a byproduct
8 saying that they should be getting some kind of -- or be
9 open to receiving some kind of credit.
10 On transit system credits, in theory we support
11 staff's recommendations to include NEVs in its
12 transportation credit system and to expand incentives for
13 car sharing and station car projects. However, we're
14 anxious about past gaining of the credit system,
15 especially with NEVs, and uncertain about the staff
16 proposal's effects on the placement in California and of
17 new zero emission vehicles, including fuel cell vehicles.
18 Therefore, we urge that before the Board makes a final
19 decision on this issue, that if the Board is inclined to
20 offer these credits, that it ask the staff for more
21 analysis on credit scaling, the effects that the proposed
22 credits would have on the ZEV Program's goal track and the
23 need to sunset the credits.
24 And, finally, for CERT alone, not for my
25 colleagues at the other organizations, I'd like to make
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1 one more comment about the stationary fuel cells.
2 CERT is the Coalition of Environmental
3 Organizations Renewable Technology Companies and other
4 companies. And we include a couple of fuel cell --
5 stationary fuel cell companies among our numbers.
6 I talked to one about this when this proposal or
7 this staff report first came out. And I have been
8 concerned that there might -- that somehow this might, as
9 the staff report suggests, might offer some kind of
10 competitive advantage to PEM fuel cell makers, but
11 especially to GM's stationary fuel cell. And before
12 revealing my concern to him, he immediately said that he
13 could see that this would have a competitive advantage --
14 it would present a competitive advantage.
15 And while CARB has worked to help increase clean
16 DG, including fuel cells, I worry that if you offer this
17 hydrogen -- this stationary fuel cell advantage with the
18 ZEV Program, really only one fuel cell company will be
19 getting that advantage, and that would be GM. And it
20 would disadvantage the other fuel cell companies that
21 don't make PEM cells. And the industry itself is in such
22 an infancy.
23 And it's really sort of a
24 hang-on-by-your-fingernails sort of effort. And that's
25 why I understand why Mr. Vail is so anxious to make any
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1 kind of effort to encourage his parent company to keep
2 plodding along with these fuel cells -- stationary fuel
3 cells. But I do think this isn't the proper approach.
4 Thank you.
5 CHAIRPERSON LLOYD: Thank you very much, Kathryn.
6 I guess since this is not a regulatory item, it's
7 not necessary to officially close the record. But I look
8 up to my colleagues on the Board for any discussion or
9 questions.
10 BOARD MEMBER DeSAULNIER: Thank you, Mr.
11 Chairman. But I was trying to get your attention awhile
12 ago.
13 CHAIRPERSON LLOYD: Sorry.
14 BOARD MEMBER DeSAULNIER: It goes back to that
15 debate last night where nobody -- if you were quiet, you
16 couldn't get the floor.
17 (Laughter.)
18 BOARD MEMBER DeSAULNIER: Yeah, I hear what
19 Kathryn's saying. And when I first talked to staff, I
20 must say when I got the briefing I was a little cranky
21 because when I was trying to explain my vision three
22 months ago and year ago, I was trying to do all things to
23 all people. I do think -- and I can see right now --
24 certainly it's not my intention. I would hope my friends
25 in the environmental movement didn't think my
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1 participation in these kind of initiatives was to
2 encourage opening large loopholes large enough for large
3 people to drive their Hummer through. So I agree with
4 staff's recommendation. But I think there's still a lot
5 of opportunities here, but they have to be very focused
6 and very directed.
7 And in terms of using it within the ZEV mandate,
8 I just saw it as an opportunity to use one currency,
9 meaning the credits, very few of them, within the mandate
10 to try to incentivize multiple opportunities.
11 And it's so difficult, you know. When I saw
12 General Motors -- I remember supporting something last
13 week that the Howard Jarvis Committee supported. And I
14 thought, "What's happening to me," you know. General
15 Motors -- similarly, my conditioned response is "Oh, my
16 God, I'm agreeing with General Motors. Maybe there is a
17 future for stationary." But I believe in redemption,
18 having had eight years of Jesuit training. So I believe
19 your marketing slogan.
20 So what my suggestion would be and I would like
21 to see, Mr. Chairman -- and given your help with the
22 interagency agreement with the Energy Commission and
23 Caltrans, which also involves the UC system -- there's
24 still some opportunities to refine this. There may be no
25 credits out of it, but I think there's an opportunity to
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1 look at -- transportation systems are where my interests
2 are. But also hydrogen infrastructure and fuel cells on a
3 very limited possibility may be within transportation
4 systems.
5 So without giving you the whole -- I'll just give
6 you the cliff notes. And my nirvana would be a few pilot
7 projects in the next five years or so that were transit
8 stations, that were running heavy rail on electricity,
9 that had distributed generation, stationary fuel cells
10 providing power for the transit station, like a ZEV NEV,
11 and for the development around it. And that hydrogen was
12 coming from renewables. So it's from wells to wheels.
13 The whole process is clean.
14 Then you have maybe stationary cars -- station
15 cars in there that are electric or electric cars or
16 potentially fuel cell cars. So they're zero, they're
17 gold. And then you have the smart mobility, smart
18 infrastructure capacity. So someone who's going to the
19 train station can use their wireless. Or if the Bay Area,
20 we now have a 5.1 connected. You can find out realtime
21 with the transportation systems. Like if you're at your
22 console at home, you can bring up cameras and see what the
23 transportation system looks like. So you can use those
24 smart ability concepts. You can see realtime parking
25 information.
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1 So that's sort of the nirvana, is combining the
2 transportation systems and from well to wheel distributed
3 generation stationary source at their -- that also
4 incentivizes the placements of, potentially NEVs, but also
5 city cars within a system. But it would be very narrowly
6 focused. And the credits, if there were credits, would
7 just be a small currency to encourage people to
8 participate in that kind of model.
9 So I think we can keep working on this for the
10 next three to six months with -- in the MOU between the
11 interagency agreement and the fuel cell partnership is
12 what I heard you say, Alan. And maybe at some point at
13 the appropriate time convene all the stakeholders and see
14 if we can narrow it down. If we can't, we come back to
15 close the book and move on to other things.
16 So that's what I hope comes out of this.
17 CHAIRPERSON LLOYD: Yeah. I would support that,
18 Mark. Again, splitting it down a little bit more, I would
19 like staff to come back on each of the areas that we've
20 talked about and explore that and see if you can come back
21 with some regulatory language.
22 I hear the concerns expressed and I understand
23 those concerns. But I think -- in this industry, I think
24 it is important to explore all those issues there. And,
25 again, I hear the concern about the stationary, about the
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1 competitive side. I'm not sure that's true because there
2 are other people out there who will do both stationary and
3 mobile.
4 And, again, I appreciate General Motors
5 recognizing some of the concerns and the constraints that
6 are there so they're not talking about having carte
7 blanche here. But, again, a very limited piece.
8 And the other part on the hydrogen
9 infrastructure, some companies have not been interested in
10 that. Others have. I think with the DOE program going
11 on, with the efforts in California, with the continued
12 talk about broadening hydrogen in California, I think it's
13 important to look at this. But I do agree with Kathryn's
14 comment, her colleagues, that we also have to look at this
15 in a realistic context of where we stand on that. So do
16 we need that? Where do we need it? And I think fall in
17 to the other one. So -- and recognize basically what
18 we're doing today is saying they -- giving staff the green
19 light to move ahead with some additional work and coming
20 back to us, or do we put a stoplight. And I think -- I'm
21 not prepared to put a stoplight because I think each of
22 these have got some exciting opportunities.
23 BOARD MEMBER RIORDAN: Mr. Chairman, I think
24 there's potential here. We just have to look at it and
25 see where it might lead us. And so I would agree with
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1 your position.
2 CHAIRPERSON LLOYD: Any other comments?
3 With that, I guess we'd -- anybody against --
4 everybody all in favor, so unanimous --
5 GENERAL COUNSEL WALSH: You don't have an
6 official action that you're taking.
7 CHAIRPERSON LLOYD: We don't have to have one.
8 Okay.
9 GENERAL COUNSEL WALSH: You do not.
10 BOARD MEMBER DeSAULNIER: How appropriate for
11 your last action. It's a non-action.
12 (Laughter.)
13 BOARD MEMBER RIORDAN: See, she's still trying to
14 keep us on the straight and narrow.
15 BOARD MEMBER DeSAULNIER: By the way, are there
16 other CARB staff who would like to come to the Bay Area to
17 live and work? We have all kind of benefits, like you
18 don't work after 5, from 5 to 6 is yoga and zen, from 6 to
19 7 is hot tubs and pinot, and you get paid better.
20 CHAIRPERSON LLOYD: Thank you.
21 Thank you very much.
22 And thank you, staff, again. And I realize this
23 is more work for you, but I think it's a just cause.
24 And seeing no other items, I officially bring the
25 September 25th meeting of the Air Resources Board to a
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1 close.
2 And, again, thank you.
3 And I wish Tom and Kathryn a safe trip.
4 (Thereupon the California Air Resources
5 Board meeting adjourned at 7:15 p.m.)
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1 CERTIFICATE OF REPORTER
2 I, JAMES F. PETERS, a Certified Shorthand
3 Reporter of the State of California, and Registered
4 Professional Reporter, do hereby certify:
5 That I am a disinterested person herein; that the
6 foregoing California Air Resouces Board meeting was
7 reported in shorthand by me, James F. Peters, a Certified
8 Shorthand Reporter of the State of California, and
9 thereafter transcribed into typewriting.
10 I further certify that I am not of counsel or
11 attorney for any of the parties to said meeting nor in any
12 way interested in the outcome of said meeting.
13 IN WITNESS WHEREOF, I have hereunto set my hand
14 this 8th day of October, 2003.
15
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21 JAMES F. PETERS, CSR, RPR
22 Certified Shorthand Reporter
23 License No. 10063
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1 CERTIFICATE OF REPORTER
2 I, TIFFANY C. KRAFT, a Certified Shorthand
3 Reporter of the State of California, and Registered
4 Professional Reporter, do hereby certify:
5 That I am a disinterested person herein; that the
6 foregoing hearing was reported in shorthand by me,
7 Tiffany C. Kraft, a Certified Shorthand Reporter of the
8 State of California, and thereafter transcribed into
9 typewriting.
10 I further certify that I am not of counsel or
11 attorney for any of the parties to said hearing nor in any
12 way interested in the outcome of said hearing.
13 IN WITNESS WHEREOF, I have hereunto set my hand
14 this 8th day of October, 2003.
15
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23 TIFFANY C. KRAFT, CSR, RPR
24 Certified Shorthand Reporter
25 License No. 12277
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